SEC Advocates Crowdfunding for Local MSMEs and Startups

• The SEC conducted a nationwide roadshow in Manila to promote the capital market as a solution to the credit gap for MSMEs in the Philippines. 
• Crowdfunding was emphasized as a viable and convenient method for MSMEs to raise funds for expansion, with participants encouraged to explore this avenue.
• Executives from registered crowdfunding intermediaries shared insights on leveraging crowdfunding for MSMEs and startups.

The Securities and Exchange Commission (SEC) has conducted a nationwide caravan in Manila to promote the capital market as a solution to the estimated $220 billion credit gap for micro, small, and medium enterprises (MSMEs) in the Philippines. The Roadshow aims to promote crowdfunding and other capital sources for MSMEs and startups.

Crowdfunding for MSMEs and Startups

In a statement, the Commission highlighted crowdfunding as a viable and convenient method for MSMEs to raise funds for their expansion. Crowdfunding involves the public supporting or funding a business idea through online platforms. 

The SEC encourages businesses to explore crowdfunding as a means to secure necessary funds for growth.

(Read more: SEC Alerts Public About Unauthorized Investment Schemes in the Philippines)

According to the discussion from the executives from registered crowdfunding intermediaries SeedIn Technology, Inc., Investree Philippines, and Eastern Securities Development Corporation (Round One), MSMEs and startups can leverage their services through crowdfunding. 

The statements were supported by Crymton Comtech Sales & Services, an MSME, which shared their positive experience with crowdfunding during the SEC’s Roadshow. They testified to the “transformative impact” of their partnership with Investree, emphasizing the reliability of these new funding avenues as valuable business financing partners. 

“These new avenues of funding prove to us that they are also reliable business financing partners, and they will help Filipino business owners propel forward even if the road seems uncertain,” the firm’s Human Resource Administrator, Lyka Tan, expressed.

Consequently, the roadshow provided participants with the chance to have one-on-one consultations with officials from these platforms during break-out sessions, facilitating personalized discussions and guidance.

(Read more: [Investor Alert] SEC Warns Public Against 8 Entities without License)

Manila Roadshow: Bridging the Credit Gap

The sixth leg of the Securities and Exchange Commission (SEC) Capital Formation Roadshow, Capital Market Formation for MSMEs and startups, commenced at the SEC E-center in Makati City last July 14, 2023. It gathered over 400 participants, mostly entrepreneurs, both in person and online. The roadshow aimed to provide information and assistance to MSMEs and startups on how to raise capital through the capital markets.

“Most of [small businesses] rely on internal resources for their capital needs. While those who apply for traditional bank loans face tedious documentation, high interest rates, and mandatory collateral requirements,” SEC Commissioner Karlo S. Bello stated. 

The seventh leg of the roadshow will be held in Iloilo City in August. The first five destinations of the event was in Davao, Cebu, Cagayan de Oro, Zamboanga, and Bacolod; next stops will be Tarlac, Baguio, Legazpi and Tacloban. 

(Read more: Leaders of Illegal Investment Scheme Arrested in Baguio)

SEC’s 888@88 Goal: Aiming for Wider Market Access

The roadshows were part of the Commission’s 888@88 goal, where it aims to have a minimum of 888 companies accessing the capital market by its 88th anniversary in 2024. 

As of May 2023, a total of 627 companies, accounting for 70.61% of the target, have already listed and accessed the capital market. This includes companies listed on the PSE, non-listed PSE companies registered on the Philippine Dealing and Exchange Corp., companies registered through direct public offering (DPO), and companies with pending IPO and DPO applications. 

Recent Developments in SEC’s Approach to Crypto Regulation

In a recent interview, SEC Commissioner Kelvin Lester Lee discussed the upcoming revised “Digital Asset Security Service Providers Rules” for crypto regulation in the Philippines. He also emphasized investor protection and addressed the situation of Binance, highlighting the SEC’s issued advisories on exchanges.

This article is published on BitPinas: SEC Roadshow Promotes Crowdfunding for Local MSMEs, Startups

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.