Fintech companies in Malaysia are expanding rapidly, and two firms seek to fund their future growth.

Kenanga Investment Bank and Malaysia Debt Ventures (MDV) targets to raise a RM300 million (~$73 million) fintech investment fund for the purpose of investing in the industry.

MDV and Kenanga to fund fintech companies until pre-IPO

Both firms will each commit RM25 million (~$6.1 million) at the initial investment phase.

The fund will be used as seed capital to provide assistance for fintech companies of different stages until they reach the pre-initial public offering (pre-IPO) stage.

MDV and Kenanga will be co-investors and joint managers of the fund that will help with the development of the industry in Malaysia.

“The fund will focus on fintech companies, as this segment yields great growth potential in addition to being a pillar of the country's digital economic agenda,” says Nizam Mohamed Nadzri, CEO of MDV.

VC firms prove their funding capabilities to fintech companies

Nadzri also stated that as the fintech sector continuously grows, it is likely to "attract funding opportunities from internet-only banks" (also known as neo banks), and other technology startups.

Furthermore, MDV Chairman Khairul Azwan Harun said that despite this, MDV will be fully committed to developing Malaysia’s funding ecosystem in the form of venture debt financing.

Claiming that they offer "better funding solutions" for fintech companies, Kenanga and MDV will showcase their strengths in equity and debt financing on fintech companies in Malaysia through the creation of this fund.