AVANA partners up with Funding Societies aim to bridge the gap of micro financing for social sellers mostly comprising Micro, Small and Medium Enterprises (MSME) and Small and Medium Enterprises (SMEs) via short term financing solutions.
“We are very enthusiastic about this partnership. Currently there is a big gap in terms of microlending to small sellers. We have spoken to banking institutions and other institutional lenders and we realised that the process is just too complicated for small sellers to go through. Alternative debt financing platforms such as P2P financing is becoming an increasingly important avenue for SMEs to obtain financing to support their business growth as traditional financial institutions further tighten their credit. Most of these sellers just need a bit of a push in terms of capital to carry them to the next level. We are also looking on how we can do this in Indonesia, where we are serving thousands of sellers there.” says Luqman Adris, CEO of AVANA.
SMEs can expect up to RM50,000 in working capital financing to expand their business via a smooth and fast online-based process without collateral as part of financing requirements as required by conventional banks.
“Through our partnership with AVANA, we are launching our first product tailored for e-commerce merchants. By leveraging on alternative data of SMEs via AVANA's platform, with consent, we will be able to provide a seamless application procedure with minimal documentation requirements. Combined with our expertise in leveraging alternative data for risk assessment, we will also be able to increase access to financing for SMEs who have previously been underserved or unserved by traditional financial institutions. This will therefore enable SMEs to focus on their businesses while we take care of their financing needs.” says Wong Kah Meng, CEO of Funding Societies.
Securities Commission (SC) had previously remarked that the SMEs sector in Malaysia has a financing gap of more than RM80 billion, despite making up 98% of all Malaysian businesses. In an effort to address the financing gap, Funding Societies to-date has regionally crowdfunded RM1.84 billion with default rate at around 1.01%.