The Securities Commission Malaysia (SC) announced four new digital-related initiatives to spur the growth of the capital market and address the funding needs of Micro, Small, and Medium Enterprises (MSMEs) and Mid-Tier Companies (MTCs).
The SC Chairman Dato’ Seri, Dr. Awang Adek Hussin, said it is essential to support the post-pandemic recovery journey of MSMEs and MTCs in terms of their financing needs and continued innovation and growth potential.
The new digital initiatives include scaling up MSME access to financing whereby SC will open new applications for registration of new equity crowdfunding (ECF) and peer-to-peer (P2P) market operators with a shariah solution.
He added that building on the SC’s Islamic fintech accelerator programme (FIKRA), this measure will also enhance the Islamic fintech ecosystem and further strengthen the Islamic capital market proposition.
“It also aims to foster the growth of MSMEs in the halal economy while allowing greater access to investments for all capital market participants,”
he said.
The commission would also introduce value propositions and register new P2P operators, focusing on offering debt-based financing instruments by MTCs and other larger companies.
Awang said that most MTCs have been largely self-reliant in financing their business growth, especially since they have outgrown existing financing avenues for MSMEs but are still too small for traditional public markets.
One of the digital initiatives is the Registration of new Recognised Market Operators-Digital Asset Exchange (RMO-DAX) to facilitate regulated digital asset investments.
Awang said that only four RMO-DAX operators registered with the SC. Hence, capital market vibrancy will increase by allowing more players to enter the market and widening the number of exchange platforms that are safe and secure for investors to invest in.
Finally, SC will co-fund an RM30 million Digital Innovation Fund (DIGID) to encourage digitalisation of the capital market.
According to the SC Chairman, the funding amount will cover up to 70 percent of approved qualifying expenses, capped at RM500,000 per project.
Interested parties are invited to submit their applications beginning 1 January 2023 for DIGID.
“DIGID aims to encourage technology investments by smaller capital market players and develop industry-wide solutions impacting capital raising and investment activities,”
he said.
Information on the new measures, including guidelines and application forms, will be updated on the SC’s website.
The SC’s initiatives are part of the digital transformation of the Malaysian capital market, making it more inclusive, innovative, and exciting. It will also contribute to developing a strong and vibrant ecosystem that will spur the country’s economic growth.
