PLAN TO REACH OUT TO MORE SMES
Funding Societies raises RM80 million for businesses in Q1, on track to surpass RM1b disbursement mark
FUNDING Societies Malaysia is on track to surpass RM1 billion in peer-to-peer (P2P) financing disbursement in Malaysia from the current RM700 million through its platform.
Co-founder and chief executive officer Wong Kah Meng said Funding Societies raised RM80 million financing for small and medium enterprises (SMEs) for the first quarter of this year.
“This would bode well for digital financing platforms like ours where we can better reach out and underwrite these SMEs based on alternative data sets that we get from our partners.
“Last year was challenging for most industries, and to an extent, P2P platforms as we serve SMEs.
“But learning from 2020, we are now in a better position to react and adjust our business model and underwriting coming into 2021,” he told the New Straits Times recently.
Funding Societies partners with online platforms, such as Lazada, Carsome and Razer Fintech, to offer financing services to merchants.
It also partners with Credit Guarantee Corporation Malaysia Bhd (CGC) for the latter’s imSME platform, which serves as an online one-stop-centre for SME loan/financing.
Wong expects the level of awareness of P2P financing to elevate further with the government’s MyDigital initiative.
He said that while the company was putting its marketing team to educate SMEs on P2P as an alternative financing method, the challenge remained for traditional SMEs that did their businesses offline.
Although the Covid-19 pandemic had accelerated digitalisation adoption, he said, there were many SMEs that did not have a stable Internet connection to follow the company’s webinars to educate them more about P2P financing. “When you start talking about SMEs that are not within the main city areas, the level of awareness (of P2P financing) is low. The plan is to start marketing our products in a much more scalable manner.
“With MyDigital, we hope to reach out to more SMEs, especially those in rural areas. For now, it remains a challenge.”
Meanwhile, Wong said he was cautiously optimistic on the outlook for this year and hoped the situation would pick up in the second half as the economy stabilised further.