Roll on Crowdfunding in Malaysia

By Crowdfund Vibe staff writers

Late last week the Malaysian Securities Commission announced it was accepting the first applications for equity crowdfunding licences. This followed on from the release of new guidelines on 10 February that introduced requirements for equity crowdfunding platforms.

Malaysia is one of the first states in Asia to authorise equity crowdfunding, which the Government sees as an important and innovative new market structure to facilitate the growth of new small scale businesses. So what is the state of crowdfunding in Malaysia, a country that is the 3rd largest economy in South East Asia and the 29th largest economy in the world?

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Global body reviews “an infant industry growing fast”

By Crowdfund Vibe Staff Writers

Crowdfunding can stimulate economic recovery by channelling capital to small and medium-sized enterprises (SMEs) according to a report issued by the Research Department of the International Organization of Securities Commissions (IOSCO).Cover IOSCO report

Their report identifies benefits and risks, particularly in the area of investor protection. It advises that governments around the world will have to harmonise their regulatory approaches to an increasingly global industry. In doing that governments and regulators will need to strike a balance between encouraging crowdfunding and mitigating the risks associated with its growth.

The report reviews both peer-to-peer lending (crowd-lending) and equity crowdfunding (crowdinvesting), and provides key insights on the main implications for users.  This is the first publication of its kind that ties together a global overview of the industry together with a comprehensive profile of its regulatory landscape in 13 IOSCO member-countries. (This includes the Pacific Rim countries of Australia, Japan, New Zealand, South Korea, Ecuador, Canada & the USA.)

While crowdfunding markets are small, they are growing fast. Driven by annual growth of 90% in peer-to-peer lending, the global crowdfunding market has doubled year on year for the last five years to a estimated $6.4 billion in 2013, according to IOSCO. The worldwide equity crowdfunding market is more modest in size and has grown at a slower pace. While the current market size is too small to cause systemic risk, IOSCO consider it has the potential to grow to a sizeable market in a short period of time.

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Crowdfunding’s Potential for the Developing World

WB report coverFrom infoDev: Growing innovation –  a global partnership program within The World Bank Group17 October 2013

A new report commissioned by infoDev studies the promise and the risks of crowdfunding as a tool to finance innovation and growth in developing countries. It also provides an in-depth case study of crowdfunding’s potential in funding clean energy and climate technologies.

Crowdfunding—the practice of raising funds from multiple individuals via the web—first emerged in an organized form in the low-investment environment of 2008, and has quickly grown into a multi-billion dollar industry projected to reach $5 billion this year, channeling funding to hundreds of thousands of ventures globally. …

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