NextGen Day

This week, the Securities and Exchange Commission (SEC) is kicking out a national roadshow to showcase quick and simple funding solutions for micro, small, and medium-sized businesses (MSMEs) in the capital market.

The SEC Roadshow on Capital Market Formation for MSMEs and Startups will begin on February 15 at the Pinnacle Hotel in Davao City, according to the commission. The focus of the roadshow will be on how MSMEs can use the capital market, including crowdfunding websites, to raise money for business growth.

Crowdfunding is a type of fundraising activity that is often carried out by startups and SMEs. Through an online platform, the general public can support or contribute to a company idea.

With the Rules and Regulations Governing Crowdfunding contained in SEC Memorandum Circular No. 14, Series of 2019, the SEC controls the country’s crowdfunding activities.

The crowdfunding regulations remove the requirement for SMEs to register securities with the SEC or obtain direct clearance from the agency in order to seek investments from the general public.

SMEs just need to use a crowdfunding middleman, financing portal, or platform that is registered with the SEC to carry out their fundraising activities.

An SME may raise up to PHP10 million within a 12-month period through the offer and sale of its securities to any investor, and up to PHP50 million through the offer and sale of its securities to qualified investors.

Investree Philippines, SeedIn Technology, Inc., and the Eastern Securities Development Corporation are the three intermediaries for crowdfunding that are currently listed with the Securities and Exchange Commission (Round One).

“The Covid-19 (coronavirus disease 2019) pandemic has left numerous MSMEs across the nation with serious financial issues. By offering these businesses potential alternatives, particularly through the capital market and crowdfunding, the SEC hopes to alleviate their financial troubles, according to SEC Chairperson Emilio Aquino.

Along with speakers from the Philippine Stock Exchange, Investment & Capital Corporation of the Philippines, the Philippine Chamber of Commerce and Industry, Investree Philippines, SeedIn Technology, and Round One, Aquino will be in charge of the roadshow in Davao City.

The SEC’s newly established office for the Advancement of Strategic Investments in SMEs (OASIS), which is in charge of the roadshow, wants to encourage SMEs to consider the capital market as a source of outside funding.

By establishing workable options for capital raising, shortening the registration procedure, and encouraging investment houses and other financial institutions to undertake SME-friendly underwriting and advisory programs, among other things, OASIS aims to advance the interests of SMEs.

The effort is also a component of the commission’s 888@88 aim, which states that by the time the SEC celebrates its 88th anniversary in 2024, at least 888 enterprises should have accessed the capital market.

The commission’s roadshow will go to several cities around the nation after Davao City, including Cebu, Cagayan de Oro, Zamboanga, Bacolod, Legazpi, Iloilo, Tarlac, Baguio, the Calabarzon region, and Metro Manila.

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