Funding Societies Malaysia has partnered with Malaysia Debt Ventures Bhd (MDV), a subsidiary of the Minister of Finance Inc (MOF Inc) and dedicated technology financier, to propel the country’s economic recovery by empowering high-potential technology-based start-ups and SMEs, in line with the Malaysia Digital Economy Blueprint.
Recognising the potential synergy with digital financing platforms, MDV is allocating a pilot fund of RM500,000 to be invested via Funding Societies’ tailored financing solutions, to extend its reach to underserved businesses, particularly those aligned with the Ministry of Science, Technology and Innovation (MOSTI)’s 10-10 Malaysian Science, Technology, Innovation and Economy (MySTIE) Framework, and to help the industry manage the post-pandemic recovery phase and regain momentum.
MDV is looking to allocate an initial sum of RM1 million for lending via digital financing platforms this year and expects to increase it to RM5 million in the near term.
Commenting on the partnership, Wong Kah Meng, co-founder and CEO of Funding Societies Malaysia said, “Participation by MDV as an institutional investor on our platform will allow us to enable more tailored financing solutions for underserved tech-based businesses, leveraging on our credit underwriting expertise of businesses operating in the digital economy.
“This is very much in-line with MDV’s objective of supporting the technology ecosystem through flexible, accessible and innovative financing solutions to catalyse growth.”
Nizam Mohamed Nadzri, MDV CEO said that MDV’s move to invest in debt instruments via digital financing platforms signifies its commitment to further develop the fintech sector consistent with its long-term plans to support and utilise digital fundraising platforms, enhance availability of financing options to technology-based companies, and expand MDV’s marketing reach.
“MDV’s participation in Funding Societies is expected to create a significant impetus to the growth of the local fintech market and support MDV’s own venture debt customers who are in the space. Funding Societies’ platform and reach have proven to be effective in providing tech MSMES with access to much-needed financing facilities in a timely and seamless manner, and MDV is pleased that we are able to make our mark in this growing market through this partnership.”
The investment programme is timely as the government is ramping up efforts to boost the growth of start-ups and technology-based businesses and encouraging participation from both public and private segments.
With a 50 percent market share in Malaysia, Funding Societies leads the SME digital financing industry for the varied business needs of SMEs. With a fully online onboarding process, the platform addresses typical challenges faced by SMEs when obtaining financing solutions including collateral requirement, physical documentation submission and lengthy processes.
The announcement comes on the back of its milestone RM1 billion business financing disbursement achieved earlier this year and the company’s recent multi-million-dollar Series C+ fundraising announced in February.
Regionally, the platform has disbursed RM9 billion in business financing across 5 million financing deals to-date.