Islamic Finance 

Independent study proposes recommendations to spur growth and drive synergies in the venture capital ecosystem

| 11 February, 2019

Kuala Lumpur, 11 February 2019 -- The Securities Commission Malaysia (SC) is reviewing recommendations proposed by the Institute for Capital Market Research (ICMR) to spur further growth and drive greater synergies in the Malaysian Venture Capital (VC) industry.

The  recommendations  are  based  on  an  in-depth  study  by  ICMR,  which  was commissioned by the SC as part of its ongoing efforts to facilitate the intermediation of  risk  capital  and  enhance  access  to  financing  for  start-ups  and  early  stage companies in the Malaysian capital market.

The independent report by ICMR highlighted the need for targeted government interventions to catalyse greater private sector participation, more integrated cooperation among the VC ecosystem stakeholders and adoption of a global mind-set. In line with this, the report proposed eight interconnected recommendations to be considered in a holistic manner:

  • Restructuring of existing public VCs to be more commercially-driven;
  • Establishment of a dedicated government agency to bridge the funding gap for nascent and high-growth ventures;
  • Establishment of fund-of-funds with matching elements and appropriate incentive mechanisms;
  • Creation of a single platform for market access to assist domestic entrepreneurs overcome developmental challenges;
  • Facilitation of the expansion of the venture debt sector;
  • Further liberalisation of VC tax incentives;
  • Establishment of a centralised information gateway to assist in research, policy formulation and industry profiling; and
  • Establishment of an inter-ministerial council to ensure alignment of objectives across different ministries involved in the VC ecosystem.

The SC will engage with relevant industry stakeholders directly as well as through the Malaysian  Venture Capital and Private Equity Development Council (MVCDC), which it chairs, on the operationalisation of these recommendations.

In undertaking the study, ICMR conducted extensive consultations with various industry  participants ranging from public and private VCs, entrepreneurs, equity crowdfunding operators to corporates and angel investors.

 

SECURITIES COMMISSION MALAYSIA

Members of the Media may contact Corporate Affairs Department at 03-62048305 (Lau Mei San), 03-62048265 (Delyana Nordin), 03-62048326 (Teoh El Sen) or fax no.: 03-62015078 or e-mail: cau@seccom.com.my.

Background information:

The Securities Commission Malaysia (SC), a statutory body reporting to the Minister of Finance, was established under the Securities Commission Act 1993. It is the sole regulatory agency for the regulation and development of capital markets. The SC has direct responsibility for supervising and monitoring the activities of market institutions, including the exchanges and clearing houses, and regulating all persons licensed under the Capital Markets and Services Act 2007. More information about the SC is available on its website at www.sc.com.my. Follow the SC on twitter at @SecComMy for more updates.

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