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By Karina Imran
KUALA LUMPUR, May 17 -- Peer-to-peer (P2P) financing platform, microLEAP is in initial discussions to bring telecommunications companies onboard as investors to grow its business and reach out to more communities, its chief executive officer Tunku Danny Nasaifuddin Mudzaffar said.
The Malaysia-based startup which offers alternative financing and investment tools is looking forward to, among others, work together with a development bank to help agri-tech farmers get financing, he said.
"We are always looking for partners to help grow our investor and issuer (borrower) base. We hope to grow our brand and platform so that more small business owners are aware that they can raise Shariah-compliant P2P financing with us as it is simpler than most people think," he told Bernama.
microLEAP had recently raised a total of over RM13.2 million from Malaysian investment holding company, MAA Group, in a new financing round, and the former claimed to be the first P2P operator in the country that offers Islamic and conventional financing on the same platform.
Besides this, it has strategic partnerships with Malaysian Technology Development Corporation (MTDC) whereby RM2 million is allocated to fund up to 30 per cent of Islamic Investment Notes and RM5 million is channelled for the COVID-19 Relief Fund initiative.
microLEAP has also partnered with Malaysia Digital Economy Corporation (MDEC) under the eBerkat programme to provide Islamic digital financial services to the Bottom 40 per cent (B40) household income group.
"We are also working closely with SME Corporation and Aims Solutions where they refer issuers to microLEAP at discounted fees for Shariah-compliant P2P financing," he said.
Regulated by the Securities Commission Malaysia, microLEAP will connect issuers, who are micro-enterprises that are looking for working capital, with multiple investors to enable these micro-enterprises to raise the much-needed financing from the crowd, he said.
Tunku Danny Nasaifuddin further explained that microLEAP is different from banks in that it taps into a different source of funding, namely the crowd, and is also less stringent in its credit process as it tries to serve the micro-enterprises that have slipped through the net of traditional banking.
"The time it takes to get your funds with microLEAP is also faster as you don’t need to come to a branch since everything is done online. Having said that, P2P financing operators will never replace banks. Banks have an important role to play in a growing economy," he said.
microLEAP is an alternative and easier option when issuers are looking for working capital financing, he noted.
Launched in October 2019, microLEAP has financed 79 micro-enterprises with a total financing amount of RM2.2 million. It has recently funded four traders of Bazaria Wangsa Maju with over RM100,000 worth of funds disbursed through its latest campaign.
"We are here to help the traders in Wangsa Maju take that next step as the economy recovers in 2021. It is important as micro and small and medium enterprises owners are the backbone of our community and failing them can lead to detrimental economic impact.
"Since then, we have received over 50 applications from Bazaria Wangsa Maju traders seeking financing through word of mouth. We hope to use this campaign as a stepping stone to expand into other constituencies outside of Wangsa Maju. We would love to collaborate with other MPs (Members of Parliament)," he said.
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