Fintech a key enabler in economic recovery

KUALA LUMPUR: The Securities Commission will seek to drive greater adoption of digital capability to enhance capital formation efficiencies and increase investor participation in the capital market.

In his opening remarks to the regulator's eight annual fintech conference SCxSC, SC chairman Datuk Syed Zaid Albar emphasised that technology is one of the main thrusts of the Capital Market Masterplan 3.

"We envision greater use of digital capability to facilitate fundraising for companies of all sizes while encouraging market innovation and financial inclusion," he said.

Last year, SMEs' GDP shrank 7.3%, more than Malaysia's and non-SMEs GDP contractions of 5.6% and 4.6% respectively last year. It was also the first time in 17 years that SME GDP was below Malaysia's GDP.

However, Syed Zaid noted encouraging developments where equity crowdfunding (ECF) and peer-to-peer (P2P) financing platforms continued to meet and support the funding needs of Micro, Small and Medium Enterprises (MSMEs).

There are currently 21 ECF and P2P platforms registered with the SC, which have collectively raised more than RM2.2bil for close to 4,000 MSMEs since their inception.

Despite an initial decline in fundraising activities due to the movement control order in the first quarter of 2020, the SC stated that these alternative platforms had assisted MSMEs in raising more than RM1.3bil in 2020.

In the first half of 2021 alone, a further RM625mil was raised through ECF and P2P, an increase of 151% and 220% respectively, compared to the same period in 2020.

ECF and P2P attracted young investors with nearly 60% of participants aged below 35.

Held over three days, the SCxSC fintech conference will have dual-track streams to allow it to cater to more topcis and broaden the issues for duscussion.

The conference also introduces a "Village of Solutions" that will showcase a suite of solutions from SCxSC partners and exhibitors.

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