Fundaztic Launches Malaysia’s First Peer-to-Peer Financing Secondary Marketby Fintech News Malaysia July 21, 2020
Fundaztic a P2P financing platform operator, has officially rolled out their secondary market. This offers over 20,000 members of Fundaztic the opportunity to trade their existing notes with one another, this allows the, adjust their portfolio strategy and increase their flexibility in the management of their cash flow.
Against the backdrop of the current economic situation, the introduction of the secondary market is especially relevant for investors who may need to sell their notes to meet their cash flow needs and to investors who may want to build broader, more resilient portfolios.
“We have been preparing for the secondary market for quite some time now. We were extremely excited when the guidelines for the Secondary Market was announced mid-April and since then, have been working relentlessly to ensure that the system is not only compliant with the guidelines but, highly secured and robust,”
says Kristine Ng, CEO of Fundaztic.
Every member on Fundaztic is eligible to participate in the secondary market. The trading value of the notes on the secondary market will be based on the remaining principal of the notes selected for trading (“seling”). The remaining principal of the Notes selected for “selling” or “transfer of rights” must be at least RM5,000. Investors may select to “sell” either a singular note (e.g. RM5000) or multiple notes (e.g. 50 notes of RM100 each) to be bundled as a portfolio at a premium or discount rate which they decide themselves.
“The reason why such a balance is set is to ensure that the transaction is a meaningful one for both the existing investor and new investor of the Notes based on the premise that the Secondary Market is to provide early exits for emergency funds and for new investors to be able to build a resilient portfolio in a quicker manner which has a direct bearing on risk mitigations as well,”
Kristine further elaborates.
The average tenure of investment notes in Fundaztic is 30 months. This provides the opportunity for investors to sell their notes earlier than the end of the investment tenure, which will result in an increase in liquidity on the platform. With that, investors will potentially be able to earn higher gross yields and better manage their portfolio.
Fundaztic is one of the six P2P financial platforms that was registered as a Recognised Market Operator for P2P financing by the Securities Commission of Malaysia (SC) back in 2017.
The platform went live on 7th July 2017 and have just crossed its 3rd anniversary with disbursements exceeding RM82 million to more than 1000 unique MSMEs providing investors with an average return of investments of about 23% after netting of defaults of less than 4% per annum.