Malaysia Digital Catalyst Grant (MDCG)

The Malaysia Digital Economy Corporation (MDEC) introduced the Malaysia Digital Catalyst Grant (MDCG) to empower Malaysia into a progressive, digital led economy and shaping a digital future in the tech ecosystem.

WHAT IS MALAYSIA DIGITAL CATALYST GRANT (MDCG)?

MDCG is designed to catalyse the use and development of disruptive and innovative sustainable solutions within Malaysia Digital (MD) promoted sectors that align with the National Fourth Industrial Revolution (4IR) Policy.

The purpose of this grant is solely for co-creation, problem-solving, development and commercialisation of innovative solutions with an end-user partner.​

OBJECTIVES OF MDCG

• To support the scaling up of Malaysian-based technology companies by way of co-creation, problem solving, innovation, development and commercialisation of disruptive or innovative solutions based on Malaysia Digital (MD) promoted sectors and tech enablers​.
• To increase the productivity, product or service quality, and business efficiency within MD promoted sectors.

Malaysia Digital (MD) Promoted Sectors include:

1. Digital Agriculture
2. Digital Services
3. Digital Cities
4. Digital Health
5. Digital Finance
6. Digital Trade
7. Digital Content
8. Digital Tourism
9. Islamic Digital Economy

The Tech Enablers include:

1. Artificial Intelligence (AI) and Big Data Analytics
2. Blockchain
3. Cloud and Data Centre
4. Cybersecurity
5. DroneTech
6. Internet of Things (IoT)
7. Robotic, Automation and Extended Reality (XR)
8. Creative Media Technology including Extended Reality (XR) and/or Mixed Reality (MR)
9. Advanced Network Connectivity and/or Telecommunication Technology

GRANT AMOUNT

The MDCG grant amount given for is different for local-owned companies and foreign-owned companies.

ELIGIBILITY CRITERIA

The eligibility criteria differs between local-owned companies and foreign-owned companies.

1. Local-owned Company

• Incorporated in Malaysia under Companies Act 1965 or the Companies Act 2016;
• Minimum paid up capital of at least RM50,000 for companies;
• Active and minimum of 51% equity held by Malaysian(s) as per shareholding structure in the SSM.

2. Foreign-owned Company

• Incorporated in Malaysia under Companies Act 1965 or the Companies Act 2016;
• Active and minimum issued and paid up capital of RM500,000.

3. Other Criteria

• In operation for at least one (1) year as of the date of submission.
  Not the subject of liquidation/winding up /bankruptcy order and has no going concern issue*.
  • *If the Applicant/Recipient has going concern issue (as reported in their latest audited account, the Applicant/Recipient to provide a letter of undertaking by the shareholder and/or director of the Applicant/Recipient to undertake that in the event that their application is approved, the Applicant/Recipient shall perform its obligations under the terms & conditions to be issued by MDEC and to provide financial support to the Applicant/Recipient to enable the Applicant/Recipient to meet its obligations and/or liabilities under the terms & conditions).
• Director(s) and shareholder(s) of the eligible Applicant/Recipient to declare and disclose if there is any business relationship/family relationship with any of MDEC’s director or employee.
  Director(s) and shareholder(s) of the eligible Applicant/Recipient to declare if they are under any litigation or legal proceeding. i.e litigation/legal proceeding relating to criminal offences, offences under any applicable laws, insolvency, or cases related to MDEC.
• Director(s) and shareholder(s) of the eligible Applicant/Recipient to declare if they are blacklisted by Malaysia Anti-Corruption Commission (MACC).
• The Applicant/Recipient with common shareholder(s) can only apply for one (1)  grant per one (1) project administered by MDEC at any one time (this requirement is not applicable to venture capital investors and registered market operator e.g.: Equity Crowdfunding Platforms).​
• If Applicant/Recipient previously has received any MDEC/government grant*, the Applicant/Recipient must:
  • Demonstrate the completion of the funded project(s).
  • Declare any notice of non-compliance/breach being recorded during the period of the funded project(s).
    • *Applicable for R&D grant only.
    • *Limited to 5 years records.
• The business nature of company is technology related services and/or MD status company (to provide MD certification number).
• The Applicant/Recipient must be MSC Malaysia status company or Malaysia Digital (MD) status company. However, if the Applicant/Recipient is not MSC Malaysia Status company or Malaysia Digital (MD) status company, the Applicant/Recipient  must apply for Malaysia Digital (MD) status during the Availability Period.

SPECIFIC CONDITIONS

The applicant is required to meet the following specific conditions throughout the project period:

• The project under application must be new and limited to one (1) single project per company. Project in progress will not qualify (Improvements or additions of functionality is considered as new)
• The Applicant/Recipient must demonstrate that it has secured the commitment of the end-user to fund their share of the project cost at the time of application (Agreement/LOI/MOU/PO)
• The Applicant/Recipient must procure approved cost items from Malaysian incorporated organisations for ecosystem development purpose unless there is valid justification provided such as no local supplier, or is counter productive
• End-users are to come from the following verticals as outlined in the Malaysia Digital promoted sectors in alignment with National 4th IR Policy:
  • MD promoted sectors: Digital Agriculture, Digital Services, Digital Cities, Digital Health, Digital Finance, Digital Trade, Digital Content, Digital Tourism and Islamic Digital Economy.
• Technology solutions to embed any combination elements of the following tech enablers:
  • Artificial Intelligence & Big Data Analytics, Blockchain, Cloud & Data Centre, Cybersecurity, Dronetech, Internet of Things, Robotic/Automation, Virtual, Augmented, mixed & Extended Reality, Creative Media Technology including extended reality (XR) and/or mixed reality (MR), Integrated circuit (IC) designed and/or embedded software, Advanced network connectivity and/or telecommunication technology.
• The Applicant/Recipient must not have any relationship with the end-user, including shared ownership, subsidiary companies, or parent companies.

APPLICATION DOCUMENTS REQUIRED

1. Project Proposal Pitch Deck using MDEC template.
2. A fully completed and signed MDCG application form.
3. Company’s financial statements (copies of one (1) year latest audited account). If the Applicant/Recipient has a going concern issue (as reported in their latest audited account) the Applicant/Recipient is to provide a letter of undertaking by the shareholder and/or authorised director (whichever applicable as per the Applicant/Recipient’s level of authority) of the Applicant/Recipient’s company to undertake that in the event that their application is approved, the Applicant/Recipient shall perform its obligations under the terms and conditions to be issued by MDEC and the said shareholder and/or authorised director to provide financial support to the company to enable the company to meet its obligations and/or liabilities under the terms and conditions.
4. Board of Directors Resolution is to be signed by the majority of directors on the appointment of an authorised signatory.
5. Copy of award(s) and/or recognition(s) received in the past 5 years (if any)
6. Company Profile
7. Project Proposal
8. Outsourcing if applicable (Company only)
   • Agreement or quotation from the outsource party(ies);
   • Declaration letter of outsourced portion of the project detailing out:
     • The scope of work of the outsourced portion;
     • The identity of the outsourcing party(ies);
     • The amount of outsourcing cost (must be corroborated with quotations and/or agreement);
     • Declaration if the outsourcing company is a related company, and
     • The arrangement should at least benefit more to the Applicant/Recipient (including copyright, ownership of IP and a declaration of no relationship in terms of shareholders and assets).
       *If outsourcing costs is involved:
   • MDEC has the right to conduct background checks on the outsourced parties to ensure there is no conflict of interest.
   • Outsourcing party(ies) (including the director(s) or shareholders) SHALL not be related to the applicant (not including venture capital investors and registered market operator e.g.: ECF platforms).
   • Supporting documents evidencing outsourced/ collaboration portion of the project as per project costing. Declaration letter of outsourced portion of the project detailing out declaration of outsourcing which includes scope of work project duration amount, including copyright,ownership of IP and declaration of no relationship in terms of shareholders and assets. The arrangement should benefit the Applicant/Recipient.
   • Outsourced work should not exceed 20% of requested grant amount.
   • MDEC reserves the right to request additional information from the Applicant at any time.
9. (a) If previously has received any grant from MDEC and/or any other ministries or agencies under the Government of Malaysia, to provide proof of project completion (i.e. closure letter from the ministries/agencies).
   *Limited to five (5) years of records from the date of approval of the Grant.
   (b) If Applicant/Recipient has an on-going grant from any other ministries or agencies under the Government of Malaysia, to provide a letter from grant awarding entity or equivalent as proof that the project is different (not overlap with the proposed project under MDEC’s grant) and has no non-compliance/breach issues being recorded during the period of the funded project(s).
10. Document confirming end-user partner has agreed to fund their share of the project cost or support the proposed project (signed agreement/MOU/LOI/purchase order)
11. Copy of MSC/MD Approval Letter if the Applicant/Recipient has been awarded MSC/MD Status OR proof of Applicant/ Recipient is applying for MD Status (i.e.: screen shot of the application at Submitted Stage) if applicable.
12. MDEC reserves the right to request additional information from the Applicant/ Recipient at any time.

APPLICATION PROCESS

Step 1:
“Register” and “Log In” with your credentials to GAIN Awards Platform.

Step 2:
Click “Start Application” under “My Applications”.

Step 3:
Select department “Grants and Funding”.

Step 4:
Select the programme “Malaysia Digital Catalyst Grant”.

Step 5:
Provide your company details and upload your application form with supporting documents.

Step 6:
Click “Submit Application” once completed (deadline by 1st June 2023 11:59PM).

Step 7:
Completeness and compliance-checking by MDEC (2 weeks).

Step 8:
Pitching session by the application (2 weeks).

Step 9:
Approval process (2 weeks).

Step 10:
Application result.

Disclaimer: The information stated in this article is the most accurate and best information available as of 23/05/2023.

Source: MDEC

Are you ready to form your Sdn Bhd with Malaysia’s #1 award-winning Online Company Secretary? Contact us now via WhatsApp @018-7678055!

Want to know more about starting a Sdn Bhd? What’s the best way to start one, and what should you be mindful of? Register and find out in our upcoming webinar!