The milestone, announced by Malaysian Industrial Development Finance Berhad (MIDF) in a statement released by MBSB Berhad, marks a shift in how financial institutions assess value by recognising intellectual property as a legitimate form of collateral and security interest.
Traditionally, many innovation driven SMEs have struggled to secure financing due to limited physical assets despite possessing strong proprietary technologies, trademarks, patents, or other forms of intellectual property. The pilot programme seeks to bridge this gap by enabling intangible assets to become part of formal credit assessments.
The initiative stems from a Memorandum of Understanding signed between MIDF and World Intellectual Property Organization (WIPO) on 24 September 2025, aimed at developing frameworks that support IP backed financing in Malaysia.
Under the programme, a Malaysian SME successfully secured financing by leveraging its intellectual property portfolio as a key component of the evaluation and security structure. The transaction incorporated specialised methodologies covering IP identification, valuation, and commercial risk assessment.
The programme is further supported by a dedicated RM10 million fund from SME Corporation Malaysia (SME Corp Malaysia), reinforcing efforts to strengthen financing accessibility for asset light SMEs and technology driven businesses.
Technical support for the initiative was provided by Adastra Intellectual Property Sdn Bhd and Inngot Ltd, which contributed expertise in valuation, commercial risk analysis, and knowledge transfer. Meanwhile, Intellectual Property Corporation of Malaysia (MyIPO) played a role in facilitating the legal and regulatory frameworks necessary for registering security interests over intellectual property assets.
According to MIDF Chief Executive Officer Azizi Mustafa, the approval represents a turning point in Malaysia’s financial ecosystem.
“This milestone marks a turning point in our financial landscape, proving that intellectual property is a viable and powerful form of collateral. By unlocking the value of intangible assets, MIDF is empowering innovation driven SMEs to translate their ingenuity into scalable growth,” he said.
Marco Aleman, Assistant Director General of WIPO, described the collaboration as a practical demonstration of how IP financing frameworks can move from concept to implementation.
“Our collaboration with MIDF demonstrates what becomes possible when the right partners come together to move IP finance forward. It is about concrete action, equipping innovators and lenders on the ground with the tools and confidence to unlock the real value of intellectual property,” he said.
With additional applications currently under review, the first approval is expected to serve as a blueprint for future innovation based lending models in Malaysia, potentially reshaping how SMEs access growth capital in an increasingly knowledge driven economy.
About MBSB Berhad
MBSB is the holding company of MBSB Bank Berhad, MBSB Investment Bank Berhad (formerly MIDF Amanah Investment Bank), and Malaysian Industrial Development Finance Berhad (MIDF).
