SEC starts investment roadshow in Davao
The Securities and exchange Commission (SEC) kicked off its nationwide roadshow in Davao on Wednesday in its bid to bring the capital market closer and more accessible to micro, small and medium enterprises (MSMES).
More than a hundred officials and executives of MSMES gathered at the Pinnacle hotel in Davao City for the start of the SEC Roadshow on Capital Market Formation for MSMES and Start-ups.
Attendees included companies, national government agencies such as the Mindanao Development Authority and the Department of Trade and Industry 11, as well as local government units, including the Province of Cotabato.
The MSME network currently accounts for 99.5 percent of total businesses in the country. It hires 63 percent of the local workforce, constitutes 25 percent of the country’s total exports, and contributes around 40 percent to the national gross domestic product.
“however, 67 percent of our MSMES are still experiencing credit constraints. Most of them 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 Chairman emilio B. Aquino said in his keynote speech.
“hence, in our bid for financial inclusion, we recognize that there really is a need to broaden the financing instruments available for MSMES."
The roadshow presented crowdfunding, among others, as an easy and accessible way for MSMES and start-ups to raise funds for business expansion.
Crowdfunding is a fundraising activity typically conducted by start-ups and Smes, where the public can support or fund a business idea through an online platform.
An SEC memorandum circular released in 2019 states that Smes no longer have to register securities with or secure approval directly from the SEC before they can solicit investments from the public. Smes need only conduct their fundraising activity with a crowdfunding intermediary, funding portal, or crowdfunding platform registered with the SEC.
There are currently three registered crowdfunding intermediaries registered with the SEC— Investree Philippines, Seedin Technology Inc., and eastern Securities Development Corp. (Round One).
As of December, a total of 205 registered issuers have successfully raised capital through the platforms of Investree and Seedin Technology. Seedin Technology’s platform alone has seen a total of P1.34 billion raised to fund 259 projects during the same period.
executives from Investree Philippines, Seedin Technology and Round One discussed the advantages of crowdfunding and how MSMES and start-ups can avail of their services during the roadshow. MSMES were then given an opportunity to consult with their officials during break-out sessions.
“[The roadshow] will surely make opportunities more accessible for micro, small and medium enterprises that may lead toward their growth and expansion. We appreciate [the Sec’s] efforts to help small business owners resume their operations as they recover from the pandemic’s efforts,” Davao City Mayor Sebastian Z. Duterte said in his message.