SME Definitions

Given that there have been many developments in the economy since 2005 such as price inflation, structural changes and change in business trends, a review of the definition was undertaken in 2013 and a new SME definition was endorsed at the 14th NSDC Meeting in July 2013. The definition covers all sectors, namely services, manufacturing, agriculture, construction and mining & quarrying.

Sales turnover and number of full-time employees are the two criteria used in determining the definition with the “OR” basis as follows:

• For the manufacturing sector, SMEs are defined as firms with sales turnover not exceeding RM50 million OR number of full-time employees not exceeding 200.
• For the services and other sectors, SMEs are defined as firms with sales turnover not exceeding RM20 million OR number of full-time employees not exceeding 75.

Detailed definition of category, namely micro, small and medium is as follows:

Under the new definition, all SMEs must be entities registered with SSM or other equivalent bodies. It however, excludes:

• Entities that are public-listed on the main board; and
• Subsidiaries of:
  • Publicly-listed companies on the main board;
  • Multinational corporations (MNCs);
  • Government-linked companies (GLCs);
  • Syarikat Menteri Kewangan Diperbadankan (MKDs); and
  • State-owned enterprises.

For more information, please refer to the

Guideline on New SME Definition

Source: SME Corp. Malaysia

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