This is what crowdfunding players think of new MAS regulations

Increased regulation will help boost confidence, industry players say.

Equity-based crowdfunding was once sealed off to retail investors, but the Monetary Authority of Singapore has just rolled out new rules to give more individual investors access to crowdfunding platforms. Despite the inherent risk in securities-based crowdfunding, industry players reckon that increased regulatory oversight will help crowdfunding platforms better compete with traditional financial institutions.

“It is now clear that crowdlending platforms need to be licensed. This will level the playing field, protect investors and will ensure growth of this alternative avenue of financing over the long run,” said Michael Tee, CEO of Singapore’s first licensed crowdfunding platform FundedHere.

Under the new regulations, pre-qualification checks for potential investors will be eased, allowing crowdfunding platforms to accept funds from non-accredited investors.

“This better reflects the true spirit and promise of crowfunding. It will invigorate Singapore's startups as well as SMEs, and will lead to greater participation in crowdfunding as a viable option to raise capital,” Tee said.

Leo Shimada, CEO of Crowdo, noted that licensing will give investors reassurance that crowdfunding platforms are operating at the highest of professional standards.

“I believe the whole crowdfunding scene is long overdue for a professional upgrade. I think there will be rapid professionalization and consolidation within the industry. Many grey or amateur operators will fall through the cracks. As crowdfunding slowly but surely transitions from niche to alternative financing to something more mainstream, I expect to see more collaboration between crowdfunding operators conventional financing institutions,” said Shimada.