National Economic Recovery Plan (PENJANA)


What is National Economic Recovery Plan (PENJANA)? 

We are now living in unprecedented times of a global pandemic due to COVID-19. The Government has steered the country through these challenging times by taking an approach focused on 6 key steps and we are now entering the 4th steps, Recovery.

The Government unveils National Economic Plan, or the PENJANA (Pelan Jana Semula Ekonomi Negara) upon entering Recovery steps. This Government is committed to taking an inclusive and holistic approach to Malaysia’s economic recovery, and it is important to us that everyone is part of this journey.

Towards this end, PENJANA will focus on 3 key thrusts – Empower People, Propel Businesses and Stimulate the Economy.

Empower People

1. Wage Subsidy Programme

Beneficiaries: 2.7 million workers

Timeline: Mid June to end September 2020

Quantum: RM5.3 billion

Objective: To promote employee retention and reduce layoffs by extending the wage subsidy programme


  • The wage subsidy programme will be extended for a further 3 months with subsidy of RM 600 per employee for all eligible employers
  • Employers are allow to implement reduced work week and reduced pay (maximum allowable reduced pay is 30%)
  • Allow employers to receive wage subsidy for employees on unpaid leave, subject to employees receiving the subsidy directly (only applicable for tourism sector ad business which are prohibited from operating during CMCO)
  • Further

2. National Employment Services Job Portal Upgrade

Beneficiaries: 50,000 unemployed

Timeline: Long-Term

Objective: To improve employment by enhancing the PERKESO job portal


  • The National Employment Services under PERKESO will be upgraded as follows:
    i. Enhancement of the job portal and employment placement services
    ii. Collaboration with the private job sites for employment matching

Further information:

3. Hiring and Training Assistance for Businesses

Beneficiaries: 300,000 job seekers

Timeline: Mid June to end December 2020

Quantum: RM1.5 billion

Objective: To encourage hiring of employees by providing financial incentives to employers


i. RM 600 per month for apprenticeships for school leavers and graduates for up to 6 months

Unemployed Workers:
i. Below 40 years old: RM 800 per month up to 6 months
ii. 40 years okd and above: RM 1,000 per month up to 6 months
iii. Training allowance of RM 4,000 per individual for those retrenched but not covered under the EIS


4. Reskilling and Upskilling Programmes

Beneficiaries: 200,000 Youth and Unemployed

Timeline: Mid June to end December 2020

Quantum: RM2 billion

Objective: To provide upskilling for unemployed workers


  • Public private collaboration on upskilling in sectors such as E&E and ICT for key investors (MIDA, corridor authorities)
  • Subsidies further studies, focused on short courses in local universities
  • Leverage entrepreneurship programs delivered by MOA, MARA, MEDAC
  • Provide training subsidy of up to RM 800 per month for 6 months through the Securities Industry Development Corporation (SIDC)


5. Gig Economy Social Protection and Skilling

Beneficiaries: 30,000 gig economy employees

Timeline: Beginning August 2020

Quantum: RM75 million

Objective: To promote the gig economy and provide a social safety net system for the gig economy and informal sector workforce


  • To promote the gig economy and provide a social safety net system for the gig economy and informal sector workforce
  • Provide MDEC with RM25 million for the Global Online Workforce (GLOW) program which will train Malaysians to earn income from serving international clients while working online from home

Further • •

6. Flexible Work Arrangement Incentives

Beneficiaries: All employees working from home

Timeline: Beginning June 2020

Quantum: RM800 million

Objective: To encourage work-from-home arrangements by providing support to both employers and employees


Government provide:
i. Further tax deduction for employers which implement Flexible Work Arrangements (FWAs) or undertake enhancement of their existing FWAs (effective 1st July 2020)
ii. Individual income tax exemption of up to RM5,000 to employees who receive a handphone, notebook & tablet from their employer (effective 1st July 2020)
iii. Special individual income tax relief of up to RM2,500 on the purchase of handphone, notebook & tablet (effective 1st June 2020)

SOCSO provide:
i. Coverage for workers involved in accidents while working at home under the EIS

Further •

7. Child Care Subsidy

Beneficiaries: Approximately 8,000 childcare centres, 5,000 households and estimated 10,000 new early education practitioners

Timeline: Beginning June 2020

Quantum: RM200 million

Objective: To support working parents during the CMCO period by subsidising child care expenses


Working parents:
i. eVouchers of RM 800 per household for mobile childcare services, to be utilised from now till end of August 2020
ii. Increase in income tax relief for parents on childcare services expenses, from RM 2,000 to RM 3,000 for Year of Assessment (YA) 2020 and 2021

Childcare centre:
i. One-off grant of up to RM5,000 per registered childcare centre (up to 31st December 2020) to comply with new healthcare SOPs
ii. Incentive to train new practitioners for child nursing and early education course

Further information:

8. My30 Public Transport Subsidy

Beneficiaries: 200,000 Malaysian public transport users

Timeline: Mid June to end December 2020

Quantum: RM200 million

Objective: To reduce the cost of daily public transportation


  • Government will introduce an unlimited monthly travel pass costing RM30 for use on all rail services (MRT, LRT, Monorail), BRT, RapidKL buses and MRT feeder buses

Further information:

9. Social Assistance Support for Vulnerable Groups

Beneficiaries: OKUs, single mothers and related NGOs
Timeline: Beginning June 2020
Quantum: RM108 million
Objective: To provide social assistance to vulnerable groups such as OKUs and Single Mothers

  • One-off financial assistance RM300 to:
    • 190,000 registered OKUs; and
    • 150,000 single mothers (income below the poverty line)
    • 2,000 volunteer Home Help Services
  • Grant for relevant registered NGOs which support vulnerable groups
  • PENJANA GLC Community – GLCs encouraged to adopt one community and will implement a social economic development project with the community

Further information:

10. PEKA B40 Healthcare Support

Beneficiaries: B40 aged 40 and above
Timeline: To begin immediately
Quantum: RM50 million
Objective: To support the the healthcare needs of low-income groups

  • The government will double the existing allocation for the PEKA B40 Programme to a total of RM 100 million in order to fund four benefits for the B40 group;
    ▸Health screening
    ▸ Medical device assistance
    ▸ Cancer treatment incentives
    ▸ Subsidy for transportation for health

Further information:

11. Internet Connectivity for Education & Productivity

Beneficiaries: All
Timeline: Mid June to end December 2020
Quantum: RM3 billion
Objective: To support e-learning and productivity activities by providing free internet connectivity

  • Free 1Gb per day between 8am to 6pm for education, productivity (video conference applications) and news by participating telecommunication companies
  • Free unlimited use of Government’s COVID-19 applications and access to Ministry of Health and other Government websites

Further information:

Propel Businesses

1. Micros and SMEs E-commerce Campaign

Beneficiaries: Malaysian MSMEs
Timeline: June to September 2020
Quantum: RM70 million
Objective: To encourage adoption of e-commerce by micro enterprises and SMEs in order to widen their market reach

  • Eligible Micro enterprises and SMEs will be onboarded to shift towards business digitalisation through a co-funded programme with MDEC and e-commerce platforms. Participating e-commerce platforms will provide the following to eligible MSMEs:
    ▸ On-boarding training
    ▸ Seller subsidy
    ▸ Sales support

Further information:

2. “Shop Malaysia Online” for Online Consumption

Beneficiaries: Malaysian MSMEs with e-commerce footprint and consumers
Timeline: August to September 2020
Quantum: RM70 million
Objective: To encourage online consumer consumption through e-commerce vouchers

  • The Government will collaborate with e-commerce platforms to Co-fund digital discount vouchers to encourage online spending on products from local retailers

Further information:

3. Technical and Digital Adoption for SMEs and MTCs

Beneficiaries: SMEs and MTCs
Timeline: Beginning June 2020
Quantum: RM700 million
Objective: To assist as well as incentivise SMEs and MTCs to digitalise operations and trade channels

  • The Government will continue to provide grants and loans to eligible enterprises for adoption or subscription of digitalisation services under the following programmes:
    ▸ SME Digitalisation Matching Grant totalling RM100 million, in partnership with telecommunication companies
    ▸ SME Technology Transformation Fund totalling RM500 million loan (application opens from July 2020)
    ▸ Smart Automation Grant totalling RM100 million, capped at up to RM1 million per company

Further information: • •

4. MyAssist MSME One Stop Shop

Beneficiaries: Micro enterprises and SMEs
Timeline: Beginning June 2020
Quantum: RM5 million
Objective: To provide guidance and facilitate the recovery process for Micro enterprises and SMEs

  • An online one-stop business advisory platform for the Micro enterprises and SMEs will be set up to enhance the outreach of the existing physical SME Hub.
  • The services offered include guidance for:
    ▸ Funding facility
    ▸ Trade facilitation
    ▸ Branding and promotion
    ▸ Technology support
    ▸ Legal

Further information:

5. PENJANA SME Financing (PSF)

Beneficiaries: Businesses in the critically affected sectors
Timeline: Mid June 2020
Quantum: RM2 billion
Objective: To assist SMEs adversely impacted by COVID-19 in order to sustain business operations

  • The banking sector will offer an additional RM2 billion of funding to assist SMEs adversely impacted by COVID-19 sustain business operations at a concession rate of 3.5%. This financing facility will be made available in mid-June 2020 with a maximum loan size of RM500,000 per SME.

6. PENJANA Tourism Financing (PTF)

Beneficiaries: Tourism sector
Timeline: Beginning July 2020
Quantum: RM1 billion
Objective: To finance transformation initiatives by SMEs in the tourism sector to remain viable and competitive in the new normal

  • Will be announced in July 2020

Further information:

7. PENJANA Microfinancing

Beneficiaries: Micro enterprises and SMEs
Timeline: Beginning June 2020
Quantum: RM400 million
Objective: To support micro enterprises through funding programmes

  • Dedicated funding support for micro enterprises via:
    ▸ New funding program for SMEs and micro enterprises at a subsidised interest rate of 3.5%
    ▸ Aggregated approved financing will be capped at RM50,000 per enterprise
    ▸ RM50 million is earmarked for women entrepreneurs
  • A dedicated amount of the funding will be carved out e.g. for women, youth entrepreneurs and social enterprises

Further information: •

8. Bumiputera Relief Financing

Beneficiaries: Bumiputera businesses
Timeline: Beginning June 2020
Quantum: RM500 million
Objective: To ensure sustainability of shariah compliant Bumiputera entrepreneurs through financial support

  • PUNB will provide RM200 million dedicated financial assistance for Bumiputera owned shariah compliant businesses in the form of:
    ▸ Working capital
    ▸ Operational expenditure
    ▸ System automation
    ▸ Equipment and expenditure to implement social distancing practices (eg. on PPEs)
    ▸ Financing of RM 100,000 – RM 1 million for up to 5 years at 3.5% p.a. profit rates. Moratorium of up to 6 months from disbursement
  • Through MARA, the Government will also allocate:
    ▸ RM300 million working capital loans to assist affected Bumiputera entrepreneurs including training colleges
    ▸ Maximum loan amount of RM1 million with 3.5% p.a interest rate

Further information: •

9. SME Go-scheme for Liquidity Support

Beneficiaries: SME contractors
Timeline: To begin in July 2020
Quantum: RM1.6 billion
Objective: To provide liquidity for SME contractors to start delivering on Government projects

  • SME Bank will provide financing support to contractors and vendors who were awarded with small government projects (aggregate value of RM 4 billion) under the Pakej Rangsangan Ekonomi (PRE) 2020 and the PRIHATIN stimulus package.
    ▸ The scheme will benefit 16,000 G2 & G3 contractors
    ▸ No deposits or collateral needed
    ▸ SME Bank shall pay directly to the contractors and vendors based on the presentation of invoices/claims

Further information:

10. Accelerated Payment Terms for GLC and Large Corporates Supply Chain

Beneficiaries: Companies in supply chains of selected GLC and large corporates
Timeline: Beginning July 2020
Objective: To provide relief cash flow to SMEs who are part of the supply chain of GLCs and large corporate by accelerating payment terms

  • To provide relief to SMEs’ cash flows, the Government is encouraging GLCs and large corporations to accelerate their vendors’ payment terms.
  • Selected GLCs and large companies have already committed to accelerate payment terms to their vendors:
    ▸ Axiata and TM have reduced payment terms for selected vendors from 45 days to 14 days
    ▸ TNB has a 7-days payment process
    ▸ PETRONAS launched the Vendor Financing Programme in collaboration with nine banks, to facilitate vendor verification and reduce approval time. In the past few months in particular, PETRONAS has accommodated payment arrangements that have enabled vendors to stay afloat

Further information:

11. Tax Relief for COVID-19 Related Expenses

Beneficiaries: All businesses
Timeline: Immediately
Quantum: RM600 million
Objective: To encourage businesses to adapt to new norms and adhere to SOPs through tax relief

  • Extend the period and expand the scope of expenses allowed as tax deduction or capital allowance for COVID-19’s prevention, including:
    ▸ Covid-19 testing
    ▸ Purchase of PPE and thermal scanners

Further information:

12. Financial Stress Support for Businesses

Beneficiaries: All businesses
Timeline: Beginning March 2020
Quantum: RM2.4 billion
Objective: To ease financial stress on businesses through remissions of penalties related to late tax payments

  • 50% remission of penalty for late payment of sales tax & service tax due and payable from 1st July 2020 to 30th September 2020
  • Extension of special tax deduction for renovation and refurbishment of business premises to 31st December 2021
  • Extension of Accelerated Capital Allowance on eligible capital expenses including ICT equipment to 31st December 2021
  • Extension of special deduction equivalent to 30% reduction in rental for SMEs to 30th September 202

Further information:

13. Social Enterprises Elevation

Beneficiaries: Relevant social enterprises
Timeline: Beginning August 2020
Quantum: RM10 million
Objective: To encourage social enterprise related activity through contribution matching

  • Provide a matching grant through Malaysian Global Innovation & Creativity Centre (MaGIC) totaling RM10 million to social enterprises who are able to crowdsource contributions and donations to undertake social projects that will address the challenges faced by targeted communities through innovative ways

Further information:

14. Spur Set Up of New Businesses

Beneficiaries: New businesses and SMEs involved in M&A
Timeline: Beginning July 2020
Quantum: RM300 million
Objective: To encourage the establishment of new businesses and transactions such as mergers and acquisitions

  • Income tax rebate up to RM20,000 per year for 3 years of assessment for newly established SME between 1st July 2020 to 31st December 2021
  • Stamp duty exemption for SMEs on any instruments executed for Mergers and Acquisitions (M&As), for period between 1st July 2020 to 30th June 2021

Further information:

Stimulate the Economy

1. Dana Penjana Nasional

Beneficiaries: Start-ups and Local private sector Venture Capital funds
Timeline: Beginning July 2020
Quantum: RM1.2 billion (RM600 million from domestic source)
Objective: To support digitalisation of Malaysian businesses by channeling funding from international investors into the local venture capital space

  • An investment fund will be established, which will match institutional private capital investment with selected venture capital and early stage tech fund managers for the following funds:
    ▸ Seed Stage / Co-creation Funds
    ▸ Series A/B Funds
    ▸ Growth Stage Tech Funds
    ▸ Venture Debt Funds
    ▸ Opportunistic Funds (e.g. e-sports, healthcare)
  • International investors and venture capital funds that have expressed interest include SK Group, Hanwha Asset Management, KB Investment Co. Ltd, Provident Growth, 500 Startups and The Hive.

Further information:

2. Technology Innovation Sandbox

Beneficiaries: Start-ups
Timeline: Beginning June 2020
Quantum: RM80 million
Objective: To encourage innovation and creativity that can propel the digitalisation of service delivery

  • An innovation sandbox will be developed to :
    ▸ Pilot new technology solutions
    ▸ Provide relaxation of regulations in order to text new technology solutions (e.g. drone delivery, autonomous vehicles)

Further information:

3. Digitalisation of Government Service Delivery

Beneficiaries: Public
Timeline: Beginning June 2020
Quantum: RM20 million
Objective: To enhance efficiency of government services delivery in light of new social distancing norms

  • Accelerate the digitalisation of government services to reduce face-to-face transactions. This includes, but not limited to:
    ▸ Stamp assessment & stamp duties
    ▸ Unclaimed money
    ▸ Online interviews for Government scholarships
  • Hackathons to crowdsource solutions for future digitalisations

Further information: • • •

4. National “Buy Malaysia” Campaign

Beneficiaries: Local businesses
Timeline: Beginning June 2020
Quantum: RM20 million
Objective: To encourage the consumption of Malaysian-made products and services

  • Push for consumption of local products and services through:
    ▸ Promoting the “Buy Malaysia” campaign by the Government and relevant agencies
    ▸ Ensuring local product tagging or identification is compulsory for big supermarket chains
    ▸ Create dedicated Malaysian products channels on major digital platforms

Further information:

5. ePenjana Credits in e-wallet

Beneficiaries: Approximately 15 million Malaysians
Timeline: July to September 2020
Quantum: RM750 million
Objective: To encourage e-wallet usage for safe, contact-free payment experience and to boost consumer spending

  • Encourage contact-free payment through the provision of:
    ▸ RM 50 worth of e-wallet credits
    ▸ Additional RM50 in value through vouchers, cashback and discounts by e-wallets
    ▸ Only for offline/physical purchases
  • This is applicable to all Malaysians aged 18 and above; and earning less than RM100,000 annually

Further information:

6. Incentives for Property Sector

Beneficiaries: Homeowners, Prospective homebuyers
Timeline: Beginning June 2020
Quantum: RM1 billion
Objective: To stimulate the property market and provide financial relief to home buyers

  • Home Ownership Campaign (HOC) to be reintroduced:
    • Stamp duty exemption on the instruments of transfer and loan agreement for the purchase of residential homes priced between RM300,000 to RM2.5 million subject to at least 10% discounts provided by the developer. The exemption on the instrument of transfer is limited to the first RM 1 million of the home price while full stamp duty exemption is given on loan agreement effective for sales and purchase agreements signed between 1st June 2020 to 31st May 2021.
  • RPGT exemption for disposal of residential homes from 1st June 2020 to 31st December 2021 (This exemption is limited to the disposal of three units of residential homes per individual)
  • In addition, the current 70% margin of financing limit applicable for the third housing loan onwards for property valued at RM600,000 and above, will be uplifted during the period of the HOC, subject to internal risk management practices of financial institutions.

Further information: • •

7. Tax Incentives for Purchase of Passenger Cars

Beneficiaries: Automotive Sector, Consumer
Timeline: Mid June to end December 2020
Quantum: RM897 million
Objective: To stimulate the automotive sector and provide financial relief to car buyers

  • Full sales tax exemption on locally assembled cars
  • 50% sales tax exemption on imported cars

Further information:

8. Extended Service Hours in the New Normal

Beneficiaries: Public
Timeline: Beginning mid June 2020
Quantum: RM20 million
Objective: To maximise productive capacity while maintaining SOPs & new normal workplace best practices

  • UTCs new operating hours:
    • Peninsular
    Weekday: 8 am – 9 pm
    Weekend: 8 am – 5 pm
    • Sabah/Sarawak
    Weekday: 8 am – 5 pm
    Weekend: 10 am – 7 pm

Further information:

9. Malaysia as Attractive Horizon for Businesses

Beneficiaries: Foreign Direct Investments
Timeline: July 2020 to December 2021
Quantum: RM50 million
Objective: To attract foreign companies to relocate their business into Malaysia by addressing the risk of re-shoring

  • Tax incentives for company relocating into Malaysia:
    ▸ 0% tax rate for 10 years for new investment in manufacturing sectors with capital investment between RM300 – RM500 million
    ▸ 0% tax rate for 15 years for new investment in manufacturing sectors with capital investment above RM500 million
    ▸ 100% Investment Tax Allowance for 5 years for existing company in Malaysia relocating overseas facilities into Malaysia with capital investment above RM300 million
    ▸ Special Reinvestment Allowance for manufacturing and selected agriculture activity, from YA 2020 to YA 2021.
    ▸ Additional operating expenditure for Malaysian Investment Development Authority (MIDA) to undertake marketing and promotional activities
    ▸ Establishment of Project Acceleration & Coordination Unit (PACU) at MIDA
    ▸ Enhancement of Domestic Investment Strategic Fund
    ▸ Manufacturing License approval for non-sensitive industry within 2 working days

Further information: •

10. Tourism Sector Support

Beneficiaries: Tourism sector
Timeline: Beginning July 2020
Quantum: RM1.8 billion
Objective: To support the tourism sector during the COVID-19 period through tax incentives

  • Tax incentives for the tourism sector:
    ▸ Tourism tax exemption from 1st July 2020 to 30th June 2021
    ▸ Extension of service tax exemption for hotels to 30th June 2021
    ▸ Extension of period for income tax relief of RM1,000 for tourism expenses to 31st December 2021
    ▸ Extension of period for deferment of tax instalment payment for tourism industry to 31st December 2020

Further information: • • • •

11. Arts, Culture, Entertainment, Events and Exhibitions Sector Support

Beneficiaries: Arts, culture, entertainment, events and exhibitions sector
Timeline: Beginning June 2020
Quantum: RM225 million
Objective: To support the arts, culture, entertainment and event industries adapt to the new normal

  • Dedicated funding and support for the arts, culture, entertainment, events and exhibitions sector as follows:
    ▸ RM100 million in soft loans with interest rate of 3.5% and RM30 million in grants for the creative, events and exhibitions industries under MyCreative Ventures and RM10 million for CENDANA
    ▸ RM50 million worth of digital marketing obtained from RM10 million Digital Marketing and Promotions Grant under MyCreative Ventures with a cap of RM5,000 per event. This can benefit 2000 events, exhibitions, and productions
    ▸ RM35 million Dana Kandungan Digital under MDEC for projects in the creative sector with a focus on animation and visual effects
    ▸ Collaboration between MyCreative and the private sector to help players adapt to new normal through training in digital distribution methods and promotion, development of new business models, and connectivity

Further information:

12. Agriculture and Food Sector Support

Beneficiaries: Agriculture and food sector
Timeline: Beginning June 2020
Quantum: RM400 million
Objective: To provide financial relief for agriculture and food players affected by COVID-19 and MCO

  • Dedicated support for the Agriculture and Food sector as follows:
    ▸ Micro credit financing under Agrobank for agropreneurs totalling of RM350 million with interest rate of 3.5%
    Maximum loan size: RM50,000
    • Tenure of loan: 5 years
    ▸ Agrofood workforce mobility via incentives for pioneer companies to train and educate workforce
    ▸ In-kind benefits for Urban Farming (e.g. Fertilisers, Seeds, Infrastructure, Equipment, Advisory and Training) worth RM500 per person and RM 50,000 per community

Further information: •

13. Commodity Sector Support

Beneficiaries: Commodity sector
Timeline: Beginning July 2020
Quantum: RM200 million
Objective: To provide financial relief for commodity players

  • Support the commodity sector through 100% export duty exemption from 1 July 2020 to 31 December 2020:
    ▸ Crude Palm Oil
    ▸ Crude Palm Kernel Oil
    ▸ Refined Bleached Deodorized Palm Kernel Oil

Further information:

14. Proposed COVID-19 Temporary Measures Act

Beneficiaries: Relevant parties such a manufacturer, renters etc
Timeline: To be tabled during July 2020 Parliament session
Objective: To mitigate potential negative impact to economic activities caused by contractual breaches and enforcement of insolvency actions on groups affected by COVID-19 and MCO

  • Introduction of COVID-19 Temporary Measures Act to minimise disruption to social and economic well-being:
    ▸ Temporary legislative measure to minimise the impact of this pandemic
    ▸ Designed to provide sufficient runway for businesses to recover their operations. This Bill will provide relief from certain contractual obligations and financial distress for the revival of the economy

Further information:

15. Sukuk Prihatin

Beneficiaries: Connectivity in schools, eligible micro enterprises (focusing on women entrepreneurs) and sectors such as healthcare sectors
Timeline: To be determined upon issuance
Quantum: Issuance in Quarter 3 2020
Objective: To facilitate the Rakyat’s participation in supporting post-recovery economic measures

  • To enable the Rakyat to join the Government in supporting post recovery measures, MOF will issue an Islamic debt instrument, the Sukuk Prihatin. Details as follows:
    ▸ Scheduled to be issued in Quarter 3, 2020 with a fully digital subscription process
    ▸ Proceeds from the sukuk issuance will be utilised for specific development programmes such as connectivity of schools (especially in rural areas), funding for micro enterprises (focused on women entrepreneurs) and research grants for infectious diseases

Further information: •

For further information, please refer to PENJANA outlines booklet .