The crowdfunding model lets Malaysians bypass banks for loans and connect directly with investors.
Sunday 19, May 2019
(Bloomberg) --Malaysia’s government is turning to the wealth of the masses, instead of reticent banks, to help solve a $4.8 billion property overhang.
Lim Guan Eng, Malaysia’s Finance Minister, said that property crowdfunding offers an alternative for home buyers, adding that he may take action against banks for rejecting housing loan applications without reason.
“But if the banks refuse to lend, it will be not only just an option, it may be more than that,” Lim said.
The Securities Commission (SC) stated that together, equity crowdfunding and peer-to-peer platforms have so far raised MYR 350 million ($84 million) for small businesses, with more than half of the 11,261 investors being younger than 35 years old.
The SC set out guidelines for property crowdfunding last week and urged those interested in setting up such a platform to call them.
Lim expects fintech to help address the gap between the glut in property supply and a lack of affordable homes.
Similarly, the government has pushed for discounts and waived stamp duty fees for first-time buyers, but he remains unhappy with the banks’ role. Loans disbursed to buy residential property shrunk five per cent in the first quarter from a year ago.
“I hope when I keep publicly asking the banks to lend more, they do not have a counter reaction by restricting loan lending,” Lim said.