Fintech can help bridge the SME financing gap, but there’s still room to play: Top in Tech

Malaysia SMEs were hit by the pandemic since they had trouble obtaining finances. According to a survey made by the SME Association of Malaysia (covering 1,713 members), 22% of the respondents have sufficient cash flow to last them a month, while 27% and 31% can sustain up to three to four months respectively.

Lending Fintech could be a solution. In fact, looking at the equity crowdfunding (ECF) scene as of 31 Dec 2020, Malaysia has seen 159 successful campaigns from 150 SMEs, raising a total of US$48.12 (RM199.23 million). Peer-to-peer (P2P) financing, on the other hand, has seen 15,862 successful campaigns as of December 31, helping 2,801 SMEs. The total amount raised is RM1.14 billion, with 7% of campaigns having raised over RM200,000.. Nevertheless, it is still a low portion of the over 900,000 SMEs in the country. The challenge now is getting people to get onboard Fintech and alternative financing.