The Department of Finance (DOF) said that micro, small, and medium enterprises (MSMEs) now have an expanded array of options to raise funds, thanks to the intensified efforts of the Securities and Exchange Commission (SEC) to facilitate accessible funding for small businesses.
Finance Secretary Benjamin E. Diokno commended the SEC for successfully encouraging MSMEs to participate in crowdfunding initiatives, resulting in the generation of millions in capital for hundreds of small businesses.
Diokno praised the SEC for its exceptional work in broadening the capital markets through digitalization and reinforced corporate governance, which has helped make the markets more inclusive.
Crowdfunding, a financing method that involves sourcing funds from a large number of investors, often through online platforms, has provided investors with access to diverse investment opportunities and enabled startups and MSMEs to access new sources of funding for their businesses.
In 2023, 146 companies collectively raised approximately P427 million for 1,114 projects through the crowdfunding initiative, with 37 companies participating in the SEC's recently concluded roadshow.
An additional 314 companies have expressed keen interest in raising capital through crowdfunding after participating in the roadshow organized by the SEC in various key cities including Baguio, Tarlac, Manila, Legazpi, Cebu, Iloilo, Bacolod, Tacloban, Davao, Cagayan de Oro, and Zamboanga.
Gov't crowdfunding raises P427 M for MSMEs
At a glance
The Department of Finance (DOF) said micro, small, and medium enterprises (MSMEs) have now more options to raise funds due to the Securities and Exchange Commission's (SEC) intensified initiatives to facilitate accessible funding for small businesses.
In a statement, Finance Secretary Benjamin E. Diokno said on Tuesday, Dec. 19, that the SEC had successfully encouraged MSMEs to participate in crowdfunding this year, resulting in the generation of millions in capital for hundreds of small businesses.
“I commend the SEC for their outstanding work in taking up the challenge of expanding our capital markets, making it more broad-based through digitalization and strengthened corporate governance,” Diokno said.
Crowdfunding is a method of fundraising where money is sourced from a large number of investors—usually through an online platform. This allows investors to access investment opportunities and enables start-ups and MSMEs to access new sources of funding for their businesses.
In 2023, 146 companies raised capital totaling about P427 million for 1,114 projects through the crowdfunding initiative. Of the total, 37 companies were participants in the SEC’s recently concluded roadshow.
Meanwhile, 314 more companies have expressed interest in raising capital through crowdfunding, after participating in the roadshow spearheaded by the SEC in Baguio, Tarlac, Manila, Legazpi, Cebu, Iloilo, Bacolod, Tacloban, Davao, Cagayan de Oro and Zamboanga.
“The SEC transformed the capital market into a more accessible financing oasis for small businesses, as our year-long nationwide roadshow proved to be a success in attracting MSMEs and startups toward innovative fundraising options,” SEC Chairperson Emilio B. Aquino said.
Several small businesses have testified to the crowdfunding initiative’s effectiveness in opening up more opportunities for business expansion as it helped small businesses gain access to both capital and financial guidance.
Aside from crowdfunding, the nationwide OASIS roadshow highlighted financing options through the Philippine Stock Exchange (PSE) as part of the Commission’s 888@88 goal.
Under this goal, the SEC targets to have at least 888 companies tap the capital market in time for its 88th anniversary in 2024.
The roadshow generated a total of 10 new leads for listing in the PSE, promising a healthy pipeline of capital-raising activities next year.
Following the success of the roadshows, the SEC launched the Call-a-Friend and Engage with SEC (CAFE SEC) platform to allow roadshow attendees to connect with crowdfunding intermediaries and the PSE for inquiries pertaining to their financing needs, and additional information on capital market-based products and services.
Since the approval of the first crowdfunding license by the SEC in December 2020, a total of 1,584 companies have already registered as issuers with the licensed crowdfunding intermediaries.
Of the total, 333 of these companies have successfully raised capital totaling PHP 1.94 billion for 1,143 projects.
Among the registered issuers were Investree Philippines, SeedIn Technology, Inc., and Eastern Securities Development Corp. (Round One).