KUALA LUMPUR: The Securities Commission (SC) and Ministry of Agriculture and Food Security (KPKM) have established the Malaysian Innovation Agri-Financing Steering Committee (MIAF) to help agropreneurs grow and support the country’s food security.
SC chairman Datuk Seri Dr Awang Adek Hussin said the steering committee is a collaborative initiative that includes KPKM, Agrobank, Malaysia Digital Economy Corporation and the SC.
"The committee aims to leverage the expertise and resources of its members to increase the agriculture sector’s understanding and adoption of alternative finance and technology, as well as facilitate the growth of investment-ready agribusinesses.
"God willing, we will achieve these objectives because together, we can drive positive change and empower agropreneurs to thrive in their industry," he said in his welcoming remarks at the SCxSC GROW Roadshow and Bioeconomy Corporation Conference here today.
He noted that since inception in 2015, less than seven per cent of the funds raised through equity crowdfunding (ECF) and peer-to-peer (P2P) lending platforms has gone into agri-related businesses.
"Hence, there are significant opportunities for agri-businesses to tap into these alternative financing methods to help support Malaysia’s food security,” he said.
Awang Adek said start-ups and micro, small and medium enterprises (MSMEs) are the backbone of the Malaysian economy; therefore, supporting their growth is vital for sustainable economic growth.
In addition to financial support, market access and partnerships are also important for sustainable growth, he said.
In the private market space, Awang Adek said, the SC has worked to develop a facilitative regulatory framework that includes incentives to ensure that venture capital (VC) and private equity (PE) managers are able to support MSMEs across a wide range of sectors.
He explainded that VC/PE firms not only provide financing, but they also support entrepreneurs in their business development journey.
"This ensures that agropreneurs have the financial backing and the business knowledge they need to grow their businesses," he said.
Meanwhile, other private market fundraising avenues like ECF and P2P financing allow investors to mobilise capital directly to agropreneurs and provides high-growth companies with more options to access capital.
In 2022, the private markets segments saw significant growth, with combined investments totalling RM3 billion from VC/PE, ECF, and P2P financing.
In addition, ECF and P2P financing have continued to grow with more than RM4.4 billion raised since inception in 2015, benefitting over 7,200 MSMEs, with 26 times more financing for the agriculture sector in 2022, he said.
To increase participation in the private market space, Awang Adek said, the SC's promotional arm Capital Markets Malaysia (CMM) has conducted a series of programmes to promote corporate venture capital (CVC) which aims to give corporate executives from Malaysian public-listed companies best practices and practical options to engage more with startups in Malaysia.
He said CVCs create opportunities for knowledge sharing, resource pooling and technology transfer, ultimately contributing to the overall development of the startup ecosystem in the country.
On Malaysia Co-Investment Fund (MyCIF), Awang Adek said the programme has invested in more than 3,600 MSMEs, totalling RM638 million, as at end-December 2022.
"MyCIF launched a special initiative to invest in agriculture-based enterprises where the government will match half of every ringgit invested into agri-businesses.
"As a result of this initiative, MyCIF's investments into agri-businesses increased nearly ninefold from only RM725,000 in 2021 to RM6.4 million in 2022,” he added. - Bernama