Crowdfunding is emerging as a viable capital-raising tool for micro, small and medium enterprises (MSMEs) in the Philippines, generating over P2 billion (about $34 million) in fresh funds for small businesses, industry sources said.
The growth comes as 361 companies have tapped licensed crowdfunding intermediaries for 1,212 projects by the end of 2024, raising an additional P2.24 billion in capital.
The Securities and Exchange Commission has observed a marked increase in interest from MSMEs in the capital market, as companies seek alternative financing options amid tightening credit conditions.
In addition, at least 358 firms have signaled their intent to explore crowdfunding as a means to secure funds, pointing to robust future activity in this segment.
Crowdfunding enables startups and SMEs to raise funds by attracting public investment through online platforms.
In the Philippines, three SEC-licensed intermediaries facilitate these transactions – SeedIn Technology Inc., Investree Philippines, and Eastern Securities Development Corp.
However, Investree Philippines, which pioneered the crowdfunding space, announced its decision to cease operations earlier this year.
The regulator remains optimistic about the crowdfunding industry despite recent operational challenges.
New rules allow SMEs to solicit investments through registered crowdfunding platforms without the need to register securities or obtain direct SEC approval, thereby streamlining the fundraising process.
In parallel with these initiatives, the SEC is also tracking 16 leads for public listing in collaboration with the Philippine Stock Exchange, signaling broader efforts to enhance MSME access to capital.
This focus aligns with the national agenda to bolster MSME growth and reduce reliance on traditional credit channels.
Earlier this month, the commission concluded a two-year nationwide roadshow for MSMEs that began in Davao City in February 2023.
The tour visited 21 major cities, including Baguio, Tarlac, Legazpi, Cebu, Iloilo, Bacolod, Tacloban, Cagayan de Oro, and Zamboanga, engaging over 3,000 onsite participants and reaching 60,000 online participants.
These initiatives underscore the government’s commitment to nurturing a dynamic financial environment that supports MSMEs’ expansion and long-term economic resilience in the country globally.
