PNIP asked to help cos intending to raise funds thru crowdfunding

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has proposed to Pakistan National Investor Portal (PNIP) to provide opportunities to the potential companies intend to raise funds through crowdfunding.

According to the details of the new projects issued by the SECP Tuesday, the portal will identify the risks involved in equity crowdfunding, so that regulatory framework addressing the concerned risks can be introduced and also identify optimal approach for regulating equity crowdfunding.

The PNIP called applications from potential companies that wanted to raise funds through crowdfunding.

Companies were further shortlisted based on due diligence criteria of the PNIP.

After shortlisting, companies went through investment readiness program, where they were prepared for pitching the issue to eligible investors.

Subsequent to the investment readiness program, platform was opened for registration of eligible investors. The platform could then match potential investors with companies seeking funds. All subscriptions were to be made through banking channels and parked in an escrow account. Performance PNIP identified/shortlisted potential companies for crowdfunding, however said companies could not be showcased before the investors due to time constraint, difficulty faced in marketing of crowdfunding platform and identification/registration of eligible investors, the SECP maintained.

The SECP has also proposed a centralised digital mutual fund distribution platform acted as an intermediary between the Asset Management Companies and the Investors. Through such platform, the AMCs had access to individual customers in remote areas and cater needs of small savers. An online dashboard enables customers to onboard through an online sign up using their email account (Gmail/Yahoo/Outlook) and complete the process.

Subsequent to KYC and linking of banking a risk profile of customer is created based upon risk appetite related details provided to the platform. Customers can browse a list of investment opportunities (Conventional/ Islamic), read about their summaries and market profiles and make their investment decision. The Application Commissioner receives the request and confirm the status of investment once the background process has been completed. Redemption request can be made online as through the dashboard. YPay will forward their request to the concerned AMC, and upon successful redemption the funds will be transferred to the customer’s linked bank account and they will be duly notified via Email notification, the SECP added.

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