Economics and Policy Planning Division, SME Corp. Malaysia 16 October 2013

Introduction Current SME Definition (adopted since 2005)

New SME Definition was endorsed by the National SME Development Council (NSDC) on 11 July 2013.

Covers all sectors including construction and mining & quarrying.

Adopted top-down and bottom-up approaches i.e technical analysis, global benchmarking and stakeholder engagements with industry associations, M&A, regulators and financial institutions to derive the definition.

Expected to raise the share of SMEs to total establishments from 97.3% currently to 98.5%.

Only business entities registered with SSM or equivalent are defined as SMEs.

Manufacturing & MRS: Sales turnover: < RM25 mil

OR Full-time employees: < 150

Services & Agriculture: Sales turnover: < RM5 mil

OR Full-time employees: < 50

Comparison of SME Definition Criteria Used Across Countries

Guiding Principles in Determining the New Definition

New SME Definition (Effective from 1 Jan 2014)

For the manufacturing sector, SMEs are defined as firms with sales turnover not exceeding RM50 million or number of full-time employees not exceeding 200

For the services and other sectors, SMEs are defined as firms with sales turnover not exceeding RM20 million or number of full-time employees not exceeding 75

FACTSHEET ON NEW SME DEFINITION