MIDA Smart Automation Grant (SAG MADANI) 2026
The MIDA Smart Automation Grant (SAG MADANI) aims to support eligible Malaysian entrepreneurs in upgrading their operations through automation, technology and digital transformation. Taking reference from the New Industrial Master Plan (NIMP) 2030, the government promotes the adoption of automation to lower dependency on manual labour, enhance productivity, increase in production capacity, and become more competitive. Today, automation does not only mean the purchase of machines or robotics, but can also refer to Artificial Intelligence (AI), industrial software, cloud computing or even the Internet of Things (IoT) technology. The grant can be part of the upgrading cost of implementation of your eligible automation project, based on the applicable terms by MIDA.
Grant Amount and Funding
Funding type is a matching grant up to 70% eligible project costs (maximum grant of RM1 million per company).
Maximum grant amount: RM1,000,000
Government contribution:70% maximum Company contribution:30% minimum
Funding examples
Total eligible project cost Potential grant (70%, subject to cap) Company's share
Project Cost Claim 70% Company Pay
grant
RM500,000 RM350,000 RM150,000
RM1,000,000 RM700,000 RM300,000
RM1,430,000 RM1,000,000 RM430,000
RM2,000,000 RM1,000,000 RM1,000,000
With the RM1million grant cap for projects above RM1.43 million, the company is required to fund more than 30% of the total project cost.
Note: These dollar figures are based on the stated funding model and should not be taken as an indication of approval. Clarify the actual 2026 grant rate, maximum amount and expenditure eligible for funding with MIDA before advising clients.
Eligible to Apply?
According to MIDA's published SAG MADANI guidelines, applicants must meet the following requirements.
Requirement Details
Company registration Incorporated under the
Companies Act 1965/2016
Local ownership At least 51% Malaysian-owned
Business operation At least 3 years
Business licence Valid licence from
local authority
Manufacturing
companies Valid MITI manufacturing licence
or MIDA exemption letter
Services companies Must operate in an eligible
service sector and hold the
relevant licence, permit or
supporting letter
Business size Must meet the applicable
MSME criteria
Eligible Catagories
The published guidelines cover manufacturing businesses and specified services sectors, including:
• Manufacturing and production
• Hotel and tourism • Private healthcare
• Private education
• Oil and gas services
• Logistics services
• Research and development (R&D)
• Digital infrastructure
• Shipbuilding and ship repair
• Green technology projects for business purposes
• Aerospace maintenance, repair and overhaul
Its not that every service business automatically qualifies. MIDA must confirm that the company's activities fall within an eligible category.
MSME size requirements
The published SAG MADANI guidelines specify the following criteria:
Category Annual Employees
turnover
Manufacturing Up to Up to 200
RM50MIL
Services Upto Upto 75
RM20MIL
A separate definition of micro-enterprises is also provided in the guidelines. These limits are established from published criteria and should be verified against current rules prior to use.
What Can the Grant Cover?
Automation machinery and equipment
Artificial Intelligence (AI)
Industrial software
Industrial IoT
Committed Deliverables:
Increase skilled Malaysian employment
Improve productivity and efficiency
Improve product quality
Increase production capacity
Application Process
1. Review eligibility: check ownership, company registration, operating history, licences, business activities and supplier quotations.
2. Define the project: identify the required machinery, equipment or software and explain how it will improve operations.
3. Prepare the application: assemble a project proposal, quotations, company records and measurable performance targets before applications reopen.
4. Submit to MIDA: use the InvestMalaysia portal and pay any evaluation fee required under the current scheme.
5. Await the decision: if the application is approved, review the offer letter and sign the grant agreement within the specified period.
6. Carry out the project: purchase and install the approved automation solution within the permitted implementation period.
7. Complete the audit and claim: submit the required supporting records and claim documents; MIDA will audit the project before approving disbursement.
The source guideline specifies an implementation period of up to 18 months from its stated effective date. It also says expenses incurred before MIDA issues its acknowledgement letter are not eligible for reimbursement. Confirm the applicable timing rules with MIDA before making purchases or committing expenditure.
7. Financing Through a Financial Institution
The published guideline describes a hire-purchase arrangement through financial institutions licensed in Malaysia that may help eligible companies fund approved automation equipment. Under this arrangement, grant proceeds may be paid directly to the financing institution instead of to the applicant company.
Any financing facility remains subject to the institution's own credit assessment and approval. Businesses should plan their cash flow carefully and should not treat the grant as guaranteed upfront cash.
Documents to Prepare
For an initial eligibility review, companies may need to gather the following:
-SSM company profile and incorporation records
-Shareholding information demonstrating Malaysian ownership
-The latest three years of financial statements and management accounts, where required
-Business licence and relevant manufacturing licence, exemption letter or service-sector permit
-Company background and project overview
-A detailed automation project proposal
-Itemised quotations from the technology supplier
-Current operating data and proposed performance targets
-Project budget and implementation timetable
-Any additional supporting material requested by MIDA
Important:
Applications under that version could be received from 10 November through 31.December 2023, on receipt of funding and government policy. It does not prove thatOther applications are open in 2026. Wait till for MIDA Press Announcement and new guideline.
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