Bay Smart Capital Ventures Sdn. Bhd. (CapBay), a Malaysian fintech company, together with CGC Digital Sdn. Bhd., a wholly-owned subsidiary and the digital arm of CGC Malaysia, have on Wednesday announced a strategic partnership to launch a new Digital Guarantee Scheme designed to provide robust capital support to unserved and underserved Micro, Small, and Medium Enterprises (MSMEs) in Malaysia.

Through a strategic risk-sharing mechanism, this collaboration directly benefits MSMEs by lowering the financing costs through more competitive rates and empowering those lacking traditional collateral to secure essential funding, the duo said in a statement.

Complementing this, CapBay utilizes proprietary artificial intelligence (AI)-driven credit assessments to drastically reduce evaluation times, delivering capital to local MSMEs with unprecedented speed.

This synergy creates a transformative ecosystem for local businesses. Notably, it marks the scheme’s first dual-facility rollout, offering both Islamic and Conventional avenues to ensure comprehensive market inclusion, leaving no viable enterprise behind.

Building on CapBay’s record of facilitating over MYR 5.4 billion ($1.36 billion) for more than 2,500 small and medium-sized enterprises (SMEs), this collaboration unlocks capital from new institutional and retail investors on CapBay’s peer to peer (P2P) platform.

Backed by CGC Digital’s guarantee, this added assurance enhances the credit profile of underserved MSMEs, enabling access to financing that may otherwise be out of reach.

By facilitating more inclusive risk-sharing, this partnership encourages greater participation from financing partners while supporting more favorable terms, including a reduced interest rate ceiling, effectively advancing CGC Digital’s mandate to expand financial accessibility.

This rollout targets businesses with at least 51 percent Malaysian ownership, offering flexible capital from MYR 50,000 ($12,556) to MYR 500,000 ($125,549) with tenures of up to 60 months to drive operational growth.

“By leveraging CapBay’s AI-driven credit assessment, we can offer seamless, rapid digital financing to serve the ‘missing middle’, viable enterprises that are often overlooked,

“Backed by CGC Digital’s guarantee, this strategic allocation represents our shared commitment to injecting vital liquidity into the MSME landscape so grassroots businesses can thrive in a modern economy,” said Ang Xing Xian, Co-Founder and Chief Executive Officer of CapBay.

Yushida Husin, Chief Executive Officer of CGC Digital, added that CGC Digital is committed to innovation that drives financial inclusion.

“Our collaboration with CapBay enables us to leverage data-driven insights to more effectively bridge the financing gap for MSMEs,” he said.

By offering a guarantee scheme that accommodates both Shariah-compliant and conventional needs, he said they not only providing a safety net for financiers but also opening doors for small businesses to scale.

“This initiative aligns with our mandate to empower the underserved with the financial tools necessary for sustainable growth,” he added.

In line with their shared vision, CapBay and CGC Digital see this collaboration as a catalyst for a more equitable economic landscape, directly supporting the aspirations of the MADANI Economy framework and the 13th Malaysia Plan (RMK13).

By combining innovative fintech solutions with reliable credit guarantees, both parties are committed to overcoming funding barriers, driving the digital transformation of the broader MSME landscape, and building a resilient, sustainable, and globally competitive sector, said the statement.

Standard Chartered launches its first Global Fusion Center in Malaysia