Funding Societies Malaysia to surpass RM1 billion in (P2P) financing disbursement in Malaysia

KUALA LUMPUR: 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 for the first quarter (Q1) of this year, Funding Societies was able to raise RM80 million in financing to small and medium enterprises (SME).

“This would bode very well for digital financing platform like ourselves whereby we are able to better reach out and underwrite these SMEs based on sort of alternative data sets that we get from our partners.

“2020 was a very challenging year for most industries, and to an extent, P2P like us as we serve small and SMEs from all industries.

“But learning from 2020, we are now in a much better position to react and to adjust our business model and risk underwriting coming into 2021,” he told the New Straits Times in an interview recently.

Funding Societies currently partnering with online platforms including Lazada, Carsome and Razer Fintech to offer financing to merchants on these platforms.

The company also partnered with Credit Guarantee Corporation Malaysia Bhd (CGC) for ampacity building programme for the latter’s imSME platform, which serve as an online one-stop-center for SME loan/financing by providing an array of financing products and services offered by the participating banks and agencies.

Wong expects the level of awareness of P2P financing to elevate further with the government’s initiative, MyDigital initiative.

He said while the company is putting its own marketing team to educate SMEs on P2P as a way of alternative financing, the challenge remains for traditional SMEs who do businesses offline.

He said while Covid-19 pandemic has push the adoption of digitalisation, there are still a lot more SMEs who do not have a stable internet to follow the company’s webinar which was done to educate them more about P2P financing.

“When you start talking about SMEs that are not located within the main metropolitan city areas, the level of awareness is quite lacking or quite low.

“The plan is definitely to start marketing our products in much more scalable manner.

“With MyDigital, we hope to reach out to more SMEs, especially the ones located in more rural areas in the country. For now, it remains a challenge,” he said.

Moving on, Wong is cautiously optimistic on the outlook for 2021 and hopes situation to pick up in the second half of the year as economy stabilised further.

He said the Covid-19 situation will continue to increase the adoption of digital technologies by SMEs and investors in the medium term.

Source: NST