Indonesia’s Financial Services Authority (OJK) has issued a regulation on equity crowdfunding, which will allow startups to raise funding through the stock market, according to local media.
Under the regulation, the OJK is authorized to ensure information transparency on the part of share issuers, credibility on the part of operators and establish a safe and reliable information technology system for crowdfunding.
The regulation states that the public offering should be implemented within 12 months, with the maximum funding raised of Rp 10 billion ($709,845).
Startups looking to issue its shares must not be public companies and are required to have a maximum of 300 shareholders, while the maximum transferred capital is Rp 30 billion.
The equity crowdfunding platform operators, meanwhile, are required to have at least Rp 2.5 billion in capital when applying for licences. They are also prohibited from having jobs as stipulated by the OJK, such as securities underwriters, securities brokers or investment managers.
Furthermore, to ensure security for investors, the OJK has stipulated that the equity crowdfunding mechanism is restricted to non-incorporated investors and those that have experience in the stock market.
There is also a cap on the amount investors are allowed to spend on this crowdfunding mechanism based on the annual income of the investors.