The Ministry of Domestic Trade and Consumer Affairs (KPDNHEP) is seeking additional funding from the government for micro and affordable franchise development programmes – following encouraging response from franchisees and targeted groups.
Secretary-general Datuk Seri Hasnol Zam Zam Ahmad said the RM5 million allocation for the programme this year was insufficient to cover all the 144 applications received. Most of the applications were from the food and beverages (F&B) and education sectors.
Photo source: Bernama.
He elaborated that KPDNHEP will select eight franchisors and 29 franchisees only. However, if they found more eligible candidates, they will try to get an additional allocation from the government in order to give assistance to those who wish to join the franchise industry.
He also added that KPDNHEP was in the process of shortlisting the 37 franchisors and franchisees. “The amount of funds that will be received by the selected franchisors and franchisees is not the same because it depends on the type of business conducted,” he said.
Based on the funds given, franchisors would be given a maximum fund of RM100,000 while for the franchisee, the fund would be between RM50,000 and RM100,000 with a financing ratio of 90:10 – where 90% is borne by KPDNHEP and another 10% contributed by the franchisee.
Furthermore, the Enhanced Franchise Development Programme (EFDP) under KPDNHEP to increase export was also actively implemented to help franchise businesses expand their brand internationally. Currently, there were more than 1,000 franchise brands registered with KPDNHEP.
On April 2021, Domestic Trade and Consumer Affairs Minister Datuk Seri Alexander Nanta Linggi announced that two grants would be offered for the micro and affordable franchise programme – with the aim of developing more franchise packages worth RM100,000 and below and increasing the number of franchise industry players from the B40 group and M40.
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