SC, agro-based agencies eye alternative financing for agriculture sector

KUALA LUMPUR: The Securities Commission Malaysia (SC) and key agriculture agencies are looking into alternative financing for the agriculture sector to address financing gaps faced by agro-based micro, small and medium-sized enterprises (MSMEs).

Some 40 representatives from agencies and industry players this week attended a workshop called GROW -- a new collaborative programme under the SC’s fintech flagship initiative, SCxSC -- in this bid to boost the country’s food security, the capital market regulator said.

"GROW is a collaborative effort by the SC and ecosystem partners to harness the potential of alternative fund-raising digital platforms to meet the needs of underserved players in strategic sectors, such as agriculture,” it said in a statement today.

The SC said equity crowdfunding (ECF) and peer-to-peer financing (P2P) were among the alternative financing mechanisms discussed as potential ways to help fund the agriculture sector.

Among those who attended the one-day workshop were officials and representatives from the Ministry of Agriculture and Food Industry, Federal Agricultural Marketing Authority and Agrobank.

"At the workshop, participants called for greater ecosystem coordination to move the agriculture sector forward and strengthen the country’s food security.

"They also emphasised the need for greater awareness on the role of alternative financing for the agriculture sector and welcomed the development of more innovative financing instruments to cater to the diverse agro-business needs," said the commission.

Following the workshop, the SC plans to have greater industry engagements with key stakeholders next yea,r including organising a GROW Fintech Conference, and this will be followed by a nationwide GROW roadshow to raise awareness on ECF and P2P financing as viable funding options for agro-based MSMEs to grow their businesses.

It said these programmes would complement ongoing government efforts to support

alternative fundraising by agriculture businesses such as the Malaysia Co-investment Fund (MyCIF). - Reuters