Good news arrived for small businesses on 9 October 2026, and it was easy to miss inside a 95-page speech: RM30 million for AI and digitalisation through MDEC. The MDEC grant most Malaysian SMEs have never claimed is about to get a new injection, and the programme it sits on has been running since Budget 2020.
“Dana MDEC 30 juta ringgit akan membantu 4,000 PMKS menerapkan AI dan mengautomasi operasi. Program ini turut melatih dan memperakui 5,000 profesional AI.”Budget 2027 speech, tabled by Prime Minister Anwar Ibrahim, 9 October 2026
Read it as two promises. 4,000 micro, small and medium enterprises helped to adopt AI and automate operations. And 5,000 AI professionals trained and certified to run it. The Prime Minister announced both at the tabling, and the New Straits Times, The Star and The Sun carried the same figures the same day.
One thing nobody has said yet: MDEC has not announced how it will run the fund. No programme name, no eligibility page, no application window. Every outlet, ourselves included, is reporting the Prime Minister’s announcement rather than an agency programme. So the useful thing to publish on day one is not speculation. It is the programme the RM30 million will sit on, because that grant has been there for six years.
Last updated: 10 October 2026. The RM30m MDEC fund was announced on 9 October 2026 and MDEC had not published eligibility rules or an application window at the time of writing. This page is revised as those details land.
The MDEC grant SMEs can already claim
Malaysia has had a digitalisation matching grant since Budget 2020. It launched on 17 February 2020, driven by the Ministry of Finance with MDEC and Bank Simpanan Nasional, and its shape has not changed in the essentials:
- 50% matching, capped at RM5,000 per company. You pay half the invoice, the grant pays the other half, directly to the provider.
- You cannot apply yourself. An MDEC-listed Technology Solution Provider (TSP) files on your behalf, against their own invoice.
- One claim per business, covering up to three approved digital services.
- A pool, not an entitlement. It began as RM500 million over five years for the first 100,000 SMEs, and Budget 2021 added RM150 million to the scheme.
| When | What changed | Why it matters to you |
|---|---|---|
| Budget 2020 | The SME digitalisation matching grant launches: 50% up to RM5,000, claimed through an MDEC-listed TSP | This is the grant people mean when they say “the MDEC grant” |
| Budget 2021 | An extra RM150 million added to the scheme | The programme survived its first year and was extended |
| 2024 | MDEC clarifies that AI software qualifies under the existing service categories | AI tools, AI websites and AI chatbots became claimable, not just accounting and e-commerce |
| Budget 2026 | The grant continues under the MSME Digital Grant MADANI, alongside a new 50% tax deduction for AI and cybersecurity training | Software and skills start stacking: claim the tool, offset the training |
| Budget 2027 | RM30 million added via MDEC for AI adoption and automation, and 5,000 AI professionals certified | Announced 9 October 2026. MDEC has not yet published how to apply for this tranche |
Source: MDEC, Initiatives & Grants, read 10 October 2026. The Business Digitalisation Initiative is the programme MDEC lists for businesses today; the older MSME Digital Grant MADANI page that most guides still link to is no longer served.
Why AI, and why this grant is the one that matters
Malaysian SMEs have been slow on AI for a reason that has nothing to do with interest. Software subscriptions, integration and staff training add up before anything works, and a small business carries that cost with no IT department behind it. A 50% matching grant changes the arithmetic on exactly that first project, which is why the 2024 clarification that AI software qualifies mattered more than its headline suggests.
Divide the new money and the scale becomes clear. RM30 million across 4,000 MSMEs is RM7,500 each if it were split evenly, and it will not be split evenly. This is funding for a first serious AI project, not a transformation programme. That is a realistic scope, and it is how a grant application should be written anyway: one process, a clear outcome, a measurable saving.
Three kinds of project fit that scope, and all three are buyable in Malaysia today.
- AI on the work you already do. Quotation drafting, invoice matching, e-invoice compliance, pulling numbers out of documents. The case for it is hours returned per week, and it is easy to measure, which is what a grant application needs.
- Agentic AI for a repeating process. You hand over a goal and the system plans and executes across your files and tools: chasing quotes, following up leads, answering first-line customer questions. Narrow scope, visible result.
- AI virtual staff. A trained agent holding a role, so enquiries are answered at 11pm and nothing sits unread. An agent is only as good as the person in the company who understands it, which is why the 5,000-certification half of the announcement is not a footnote.
Source: MDEC, Business Digitalisation Initiative — Offerings, read 10 October 2026. This is MDEC’s current front door for business digitalisation; the RM30 million announced in Budget 2027 has not yet been attached to a named programme.
How an SME claims it: five steps
The mechanics of this grant have been stable since 2020, so an application started now is not wasted even before MDEC publishes the new tranche’s rules. One warning first, because it is the most common reason an application dies: you do not apply. Your provider applies for you.
| Step | What you do | Where it goes wrong |
|---|---|---|
| 1. Check you are eligible | Registered with SSM, at least 60% Malaysian-owned, six months trading, minimum annual turnover of RM50,000 | Ownership or trading-history mismatches stall applications |
| 2. Choose a listed provider first | Confirm the provider is on MDEC’s panel before agreeing the project | A provider who is not listed disqualifies the claim, whatever the project is worth |
| 3. Get a written quotation | The quotation and service agreement carry your company stamp and signature | No quotation, nothing to co-fund |
| 4. Let the provider file | Your SSM documents, the director’s IC, and two months of bank statements | Applying direct is the top rejection reason on this scheme |
| 5. Pay your half, then activate | You pay 50%; the balance goes from the bank to the provider | A subscription is covered for the first year only, not renewals |
Source: The Star, 9 October 2026, “Budget 2027: RM6bil allocated to boost research, development and commercialisation across ministries”. Only the fact-bearing passage is shown; the same figures ran in the New Straits Times and The Sun.
Where BigDomain fits
BigDomain has been on the provider side of this grant route for years. We hold MD (Malaysia Digital) status and are an MDEC 100 Go Digital Technology Solution Provider, which is the list a business must buy through for a claim to be valid. That is the role we have played for Malaysian SMEs on digitalisation work, and it is the role we expect to play for the AI tranche: scoping one narrow project, quoting it, filing the claim, then doing the work.
If you want the RM30 million to change something real, the sequencing is boring and it works. Assess where your business actually loses hours. Pick one process. Then talk to a listed provider about whether it fits the grant and what the claim would look like. BigDomain is on MDEC’s provider list and holds MD status. If you want a listed provider to scope the project and file the claim, Talk to BigDomain about your AI project.
Sources
- Ministry of Finance, Ucapan Belanjawan MADANI Kelima Tahun 2027 (Budget 2027 speech), tabled 9 October 2026 — belanjawan.mof.gov.my
- MDEC, Business Digitalisation Initiative — mdec.my, read 10 October 2026
- MDEC, BDI Offerings and Business Digital Maturity Level & Assessment — mdec.my, read 10 October 2026
- MDEC, Initiatives & Grants — mdec.my/grants, read 10 October 2026
- The Star, “Budget 2027: RM6bil allocated to boost research, development and commercialisation across ministries”, 9 October 2026 — thestar.com.my
- New Straits Times, “2027 Budget: Here are the key announcements”, 9 October 2026 — nst.com.my
- Maxis Business, SME Digitalisation Grant guide, citing MDEC’s SME digitalisation programme (grant design, the Budget 2020 origin, the 17 February 2020 launch, RM500m over five years and the RM150m added in Budget 2021) — maxis.com.my
- The Sun, “Budget 2027 leaves key tech industry proposals unaddressed, says Pikom”, 10 October 2026 (Pikom’s call for published eligibility rules and delivery timelines) — thesun.my
BD Media is the editorial desk of Big Domain. The RM30 million fund was announced by the Prime Minister on 9 October 2026; MDEC had not published eligibility rules or an application window at the time of writing. Confirm current terms with MDEC or Bank Simpanan Nasional before you budget on them.
