New ECF, P2P Financing Operators and Property Crowdfunding Framework Announced at SC Fintech Roundtable
17 May 2019   |   Kuala Lumpur
Minister of Finance YB Tuan Lim Guan Eng met with representatives of the financial technology (fintech) industry at a Fintech Roundtable organised by the Securities Commission Malaysia (SC) today.

The roundtable discussed the progress of the fintech industry in fostering digital innovation to meet the financing needs of micro, small and medium enterprises (MSMEs) and enable greater financial inclusion for Malaysian issuers and investors.

The SC announced eight new Recognized Market Operators comprising three equity crowdfunding (ECF) and five peer-to-peer (P2P) financing platforms. They received their letters of registration from the SC chairman Datuk Syed Zaid Albar, witnessed by YB Minister, before the start of the roundtable.

‘‘The SC will continue to facilitate development of innovative digital solutions which democratise access to investments while broadening financing options available for all Malaysians. The introduction of ECF and P2P financing provides an alternative source of capital for MSMEs to fund business expansion, finance working capital and meet other financial requirements,” said Syed Zaid.

With the addition of the new ECF and P2P financing players, which will operationalise by the end of the year, there are now 21 market-based financing platform operators registered in Malaysia. As at end-March 2019, the ECF and P2P financing market has provided close to RM350 million of alternative financing for nearly 900 Malaysian MSMEs.

The SC also released a new property crowdfunding framework following amendments made to its Guidelines on Recognized Markets. This is pursuant to an initiative announced in Budget 2019 to provide an alternative financing avenue for first-time homebuyers.

Property crowdfunding offers the same potential as that of ECF and P2P financing platforms in providing an alternative source of financing but is specifically tailored for first-time homebuyers. At the same time, it will provide investors access to a new investment option.

To support the integrity of the scheme and protect investors’ interest, the revised guidelines list out the requirements and obligations of a property crowdfunding platform operator. These include minimum shareholders’ funds of RM10 million; obligation to provide fair, clear and timely information to both homebuyers and investors prior to participating in a property crowdfunding campaign; and exit certainty at the end of the agreed tenor.  

The property crowdfunding framework was issued after taking into consideration, among others, feedback and input from members of the public including industry players during a recent public consultation by the SC.

Interested parties can submit their application to operate a property crowdfunding platform to the SC from 17 May 2019 to [email protected] More details can be found at www.sc.com.my.
Minister of Finance YB Tuan Lim Guan Eng and Securities Commission Malaysia Chairman Datuk Syed Zaid Albar met with representatives of financial technology (fintech) industry at a Fintech Roundtable organised by the SC
SECURITIES COMMISSION MALAYSIA

NOTE TO EDITORS
  1. The Fintech Roundtable was attended by representatives of equity crowdfunding (ECF) platforms, peer-to-peer (P2P) financing platforms, digital investment management service providers and digital-only intermediaries regulated by the SC.
  2. The new Recognized Market Operators are:
    - ECF (3): Ethis Ventures, 1337 Ventures, My Startr
    - P2P (5): Bay Smart Capital Ventures, Capsphere Services, Crowd Sense, MicroLEAP, MoneySave Capital 
  3. In the initial phase, only certain eligible properties and homebuyers will be allowed to participate in property crowdfunding. Eligible participants must be first-time homebuyers, Malaysians and above 21 years old. Meanwhile, the eligible properties must be completed residential properties with valid certificate of completion and compliance; valued at not more than RM500,000 at point of primary offering; and limited to properties within Malaysia with valid and effective legal title with no encumbrances attached.
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