Khazanah, CGC Digital Invests in Funding Societies to Bridge RM 90B Funding Gap
by Fintech News Malaysia January 3, 2024Malaysia’s sovereign wealth fund Khazanah Nasional and CGC Digital have made a strategic investment in SME digital financing platform Funding Societies. The sum was not disclosed.
The investment is expected to enable Funding Societies to expand its reach beyond beyond Kuala Lumpur, Selangor, Penang, and Johor. The firm targets to serve over 25,000 MSMEs across the country by the end of 2025.
This expansion includes widening the availability of Islamic financing solutions, with over RM100 million in Shariah-compliant financing already disbursed since its introduction in May 2023.
Funding Societies seeks to bridge the significant RM90 billion funding gap faced by MSMEs in Malaysia following this investment.
Part of its Dana Impak initiative under the Advancing Malaysia strategy, Khazanah’s investment aligns with the government’s goal to enhance MSME performance and promote socioeconomic growth, especially in rural and semi-urban areas with limited access to financial services.
Prior to this, Khazanah was the lead investor in local insurtech company PolicyStreet’s RM67 million (US$15.3 million) Series B funding round in June last year.
Funding Societies had previously joined forces with CGC Digital in August last year to develop a new digital credit guarantee product for MSMEs.
Since its inception, Funding Societies has disbursed over US$3.5 billion (RM16 billion) in business financing through five million transactions across its five markets in Southeast Asia, namely Malaysia, Singapore, Indonesia, Thailand and Vietnam.
Dato’ Amirul Feisal Wan Zahir
Dato’ Amirul Feisal Wan Zahir, Khazanah’s Managing Director said,
“The investment in Funding Societies reflects our commitment to fostering financial inclusion and bridging the funding gap, especially within the MSME community. Being the backbone of Malaysia’s economy and contributing nearly half of the nation’s employment, MSMEs are both critical and critically underserved. Hence, this investment aligns with our mission of contributing to nation building and socioeconomic growth”.
Kelvin Teo
Kelvin Teo, Co-founder and Group CEO of Funding Societies said,
“We are honoured to receive support from Khazanah and CGC Digital, who share our conviction to impact and MSMEs. This is a testament to our commitment towards extending credit to reach more underserved MSMEs. We would also progressively offer MSMEs more cash flow management solutions to power their growth.”
Featured image credit: Edited from Freepik
