Establish a Crowdfunding Company in Malaysia

Updated on Thursday 01st November 2018

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Crowdfunding is an alternative system through which businesses can fund their activities and the development of their products or services; this type of funding is provided by a wide category of persons, including natural persons, who want are interested in sustaining a particular type of business.  
 
Those who want to open a company in Malaysia through a crowdfunding platform have good news when it comes to the crowdfunding sector here, as such activities are expected to grow in the following years, as stated by the Asian Institute of Finance. Our team of specialists in company formation in Malaysia can provide legal assistance on this matter, to both local and foreign businessmen. 
 

Why start a crowdfunding company in Malaysia? 
 

Malaysia is an attractive business destination in its region for a wide category of business activities and crowdfunding is included here as well. Although a newer type of business activity, the crowdfunding is expected to reach, at a global level, a total value of $96 billion in 2025, as stated by the World Bank. One benefit of starting the procedure of company registration in Malaysia in this sector is given by the fact that the country adopted a legislation on the matter, which states the following: 
 
  • the regulations concerning crowdfunding are included in the Capital Markets and Services Bill 2015;
  • the rules of law addressed to crowdfunding are created in order to protect the interests of both the investors and the companies;
  • the legislation imposes a threshold on the amount of money a company can collect through crowdfunding;
  • in the case of small and medium-sized companies, it is allowed to crowdfund a maximum of RM 3 million
     

Who can obtain funds through crowdfunding in Malaysia? 
 

The crowdfunding system is opened for a wide category of business entities. Besides companies, retail investors may also obtain funds, as follows: a maximum of RM 5,000 per each company and, throughout a year, the maximum value can’t exceed RM 50,000. Our team of specialists in company formation in Malaysia can provide further information addressed to retail investors. 
 
It is important to know that any fraud activities related to crowdfunding are stipulated under the Capital Markets and Services Act (Section 179), which stipulates that a person can be fined with up to RM 1 million; businessmen are invited to contact our team of representatives in company formation in Malaysia for more details.