As fintech become increasingly important worldwide, the Thai government and the Office of Securities and Exchange Commission (SEC) have expressed their desire to see one of its components – crowdfunding – take roots in Thailand.
Hongsin Kwek, the CEO and founder of a well-know crowdfunding hub PhoenixICT is keen to do just that.
Kwek, was one of the organisers of Crowdfunding Asia, the first conference of its type focused on the Asian markets since 2014. Currently, she is a consultant for the Thai government to help make crowdfunding feasible in the country.
She spoke to DEALSTREETASIA about different aspects of Thailand’s crowdfunding situation.
How do you consider the development of crowdfunding in Thailand?
In Thailand, offline crowdfunding is commonly seen and practised by many people who contribute and give to temples. There were donations given via organisations like Taejai for all great cause. Ookbee for book is another platform that helps authors and writers to raise fund.
Equity crowdfunding conversation has come to fruition when Dr Vorapol Socatiyanurak, former secretary-general of the SEC, took step to lead with his team. He believes that crowdfunding should ultimately be self-regulated as Thailand keeps driving digital economy and it will serve the funding demand for growth. Though at infancy stage, that means a lot of opportunities!
I have invested in Thai first-ever Crowdfunding SAAS platform, offering full fledge option from Donation, Reward, Equity and soon Lending model. I believe that the market is huge and Thailand is definitely one of the movers in crowdfunding as reference to ASEAN’s crowdfunding development. However, there are just lots of work to be done.
Comparing to other countries including Singapore, how interesting and how different is the Thailand’s crowdfunding?
Asean development is interesting despite being in its infancy. Uniquely, each of ASEAN countries is taking steps on learning, adapting, applying where crowdfunding could be possible. Malaysia is the first to launch their equity crowdfunding regulations with six licenced platform. While in Thailand, they are working hard on ensuring market acceptance and taking focus on investor protection. Rules and regulations are stringent. But the regulators are very open to take feedback and suggestions to best serve issuers, investors and platform providers. In Singapore, they are treading only on high net worth investors and, therefore, equity crowdfunding platform providers or debt-based crowdfunding platform providers are individually qualified by Monetary Authority of Singapore. The rest of ASEAN members are still a distance to start crowdfunding regulations. In Asia context, China, India, Japan and Korea are already in action for crowdfunding be it equity or debt based.
For donation and reward platform, they are in action in most part of Asia…
What are the obstacles for foreigners to step into crowdfunding here?
One of the common obstacles is the requirement to have the platform 51 per cent stake Thai-owned; setting up a local entity is not easy. The local market is still learning about crowdfunding, which is a global thing.
What would you like to suggest to Thai government?
To jive up the local crowdfunding scene, there are two main points I’d like to suggest. First, to promote and support home-based crowdfunding platform by encouraging startup and SME or businesses to use the local platform; on success of fund raised on local platform, government may offers a matching fund. Second, seed fund program is great offering to SMEs and startup but exploring the use of crowdfunding would means validation, branding, marketing and positioning. The latter will also assure the investors to step forward with confidence on successful projects.