SMART AUTOMATION GRANT (SAG)
Mida Machinery Grant

INTRODUCTION

Smart Automation Grant (SAG) aimed at encouraging the adoption of automation for industry players, particularly local manufacturers and service providers. Under this Smart Automation Grant scheme, the Government has allocated RM100 million, capped at up to RM1 million per company. 

OBJECTIVE

The main objectives of the Smart Automation Grant are:

  1. To assist as well as incentivise Small and Medium Enterprises (SMEs) and Mid-Tier Companies (MTCs) to automise and digitalise operations, production and trade channels

  2. To improve efficiency in the manufacturing and services sector

  3. To reduce reliance on low-skilled foreign workers

  4. To provide job opportunities in high value-added sectors

  5. To enhance SME competitiveness on an international level

  6. To be aligned with the National Policy on Industry 4.0

  7. To boost domestic investment

GRANT

The Smart Automation Grant will be given on a matching basis (1:1) based on eligible expenditures, up to a maximum grant of Ringgit Malaysia One Million (RM1,000,000) per company

ELIGIBILITY CRITERIA

  1. 1. Incorporated under the Companies Act, 1965/ 2016. 

  2. 2. Effective equity of the company must be at least 51% owned by Malaysians.

  3. 3. The company possesses a valid Business Licence from a Local Authority.

  4. 4. The company must engage in the following activities:

  • i. Manufacturing activity in compliance with the Industrial Coordination Act, 1975; or

  • ii. Services activities which must be regulated by specific acts/ regulations or governed by relevant ministries/ agencies.

       5. The company has been in operation for at least 12 months.

       6. The company must meet at least one of the Committed Deliverables as attached in Appendix I.

  1.  7. Eligible for SMEs and MTCs only

Definition of SME and MTC:

Defination.jpg

ELIGIBLE EXPENDITURES

 

Eligible expenditures refer to the automation machine/ equipment/ software that are used directly in the overall value chain of manufacturing and services activities.

Non-eligible expenditures*:

  • Purchase or rental of land / building / office / vehicles / equipment 

  • Purchase or rental of second hand or refurbish automation machinery / equipment / software 

  • Maintenance and repair costs including renovation of premise 

  • Wages paid to employees 

  • Employee benefits programs 

  • Legal and stamp duty fees 

  • Insurance 

  • Collateral or loan including its interest paid for purpose other than smart automation 

  • Office expenses and supplies including general purpose computers & peripherals and mobile phones 

  • Utility expenses 

  • Research & development expenses 

  • Advertising and marketing expenses

*This list is not meant to be exhaustive and will be reviewed from time to time

PROJECT DURATION

 

  1. The project must be completed within 12 months from the date of the Approval Letter issued by MIDA.

  2. Any unutilised grant amount after 12 months will be withdrawn by MIDA.

  3. Any request for extension is required to be made at least 2 months before the project end date and is subjected to the approval of the Committee.

 

 

APPLICATION PROCESS

 

The application processes are as follows:

 

  1. Application for Smart Automation Grant is submitted to MIDA.

  2. MIDA will then evaluate the application and invite the eligible applicant to present their proposal at a pitching session in MIDA.

  3. Eligible applicant will present (pitching session) their proposal to the Smart Automation Grant Approval Committee (SAGAC) at MIDA.

  4. Once approved, the company will receive the approval letter and sign a grant agreement with MIDA.

  5. Awarded company has to purchase* and install the automation machine/ equipment/ software.

  6. Awarded company will need to apply to MIDA for the disbursement of grant within 6 months from approval date.

  7. MIDA will conduct an audit visit and report the audit findings to the Committee on Coordination & Disbursement of Grants (JPPG).

  8. Once approved by JPPG, MIDA will disburse the grant to the awarded company. For companies using Panel Banks, the grant will be disbursed to the selected Panel Banks.

* Note: Company may apply for hire purchase financing from the Panel Bank to purchase the automation machine/ equipment/ software, and use the MIDA Approval Letter as a supporting document

ProcessWorkflow_SAG.jpg

ACCELERATION PROGRAM

 

Recognising the need to create awareness and provide knowledge to companies on automation and digitalisation, MIDA in collaboration with selected Panel Banks will organise a special Acceleration Programme.

 

Under this programme, companies will go through a series of session which will help them refine their knowledge on automation and digitalisation through simulation trainings and evaluations. Subsequently, the company will share their plans to start developing or adopting new technologies to automate their production process or to digitalise their business operations.

 

Successful companies under this programme may submit their application to MIDA and present their application to the SAGAC at MIDA for approval.

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EFFECTIVE DATE OF APPLICATION

 

Applications received by Malaysian Investment Development Authority (MIDA) from 4 December 2020 to 31 December 2021 are eligible to be considered for this grant.

DOCUMENTS REQUESTED

Applicants are required to submit the following documents:

  1. Application Form (PENJANA SAG)

  2. Latest Financial Statement (audited)

  3. Latest SSM Company Profile (e-Info) by Companies Commission of Malaysia (SSM)

  4. A copy of Business Licence from Local Authority

  5. A copy of Manufacturing Licence (ML) OR a Confirmation Letter Exempted from ML from MIDA under Industrial Co-ordination Act, 1975 (Applicable for manufacturing company only)

  6. A copy of License/ Permit/ Support letter from relevant ministries/ agencies that govern the activities. (Applicable for services company only)

SAG Increase Production Service Measures
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