KUALA LUMPUR: The government will set up a co-investment fund (CIF) totalling RM50 million from existing grants to be invested in the small and medium enterprises (SMEs) together with the private investors through equity crowdfunding (ECF) and peer-to-peer (P2P) platforms.
Second Finance Minister, Datuk Seri Johari Abdul Ghani, said the Securities Commission (SC) would assist in establishing the fund including deciding on the co-investment criteria for equity and debt financing.
“The platforms (ECF dan P2P) are very important for the SME ecosystem as it provide the opportunities for the SMEs to expand their business,” he said to reporters after launching SCxSC Digital Finance Conference 2017 here today.
He said the government through SME Corporation Malaysia would utilise these platforms in giving out the grants to the SMEs.
Earlier in his keynote address, Johari said through the CIF, the government was hoping to provide efficient mechanism for shared partnership and responsibility with Malaysian investors to co-invest and grow the SMEs.
He said for investors, the “democratisation” of funding would strengthen the investor base among retail investors.
“With the availability of the right products and platforms, retail investors can now participate easily in investment activities and stand to gain from their ventures,” he said.
He said for investors who viewed investing as a powerful tool to drive sustainable and inclusive agenda, participation in investment activities would enable this class of investors to be directly involved in making impactful changes through sustainable investment options.
Johari said with the growing Internet penetration as well as the availability of various alternative financing platforms, investing activities were no longer exclusive for “accredited investors” but more accessible to the masses.
He said the development must be welcomed and the benefits of the democratisation of investments were indeed multi-pronged.
“For small businesses and start-ups, democratisation of investments means that they have higher chances to secure funding, and more often than not, at a more affordable cost,” he said.
He said apart from ECF and P2P, the government was also encouraging the growth venture capital industry.
“Because these three are part of the ecosystem that we need to create in order to take the risk out from banking sector,” he added. – Bernama