TECHNOLOGY has encouraged product innovation and created new ways and means of doing business in an age of digital disruption. Leveraging these advancements, three new initiatives have been announced in Budget 2019 to broaden retail investors’ participation and stimulate more innovative market-based financing options:
1. The Securities Commission Malaysia (SC) will put in place a regulatory framework to regulate digital asset exchanges and initial coin offerings to facilitate a fair and orderly development of this nascent market. These regulations are expected to come into effect in the first quarter of 2019.
2. A Co-Investment Fund, with a grant of RM50 million, will be established to enable the government to co-invest with private investors to finance the development of new businesses, especially for the micro, small and medium enterprise segment, through equity crowdfunding and peer-to-peer financing platforms.
3. The introduction of property crowdfunding platforms, which will be regulated by the SC, will provide alternative financing options to first-time homebuyers and give investors exposure to the property sector with smaller investment amounts. This initiative is one of a series of measures to facilitate home ownership.
The SC will work with the relevant stakeholders to make these measures operational.
Further details of these measures will be announced in due course.
The establishment of a Special Committee on Islamic Finance, led by the Ministry of Finance, was also announced. Together with the extension of tax incentives for sukuk ijarah and wakalah, this will reinforce the country’s position as a global leader in Islamic finance. In addition, the extension of incentives for retail sukuk and bonds will encourage more issuances of such instruments and attract greater retail participation in the capital market.