Peer-to-Peer (P2P) Financing

Peer-to-peer (P2P) financing is another innovative form of financing that allows entrepreneurs and small businesses to unlock capital in small amounts from a pool of individual lenders. P2P enables businesses to borrow and investors to lend capital through online platforms registered with the Securities Commission Malaysia (SC). The SC launched the P2P Framework in May 2016. As at end-December 2022, about RM3.87 billion of P2P financing had been raised through 54,791 successful campaigns and 6,913 issuers. On a related note, almost half (49%) of the investors were aged below 35 years, with 89% of the invested funds stemming from retail investors.

The P2P segment notably flourished in 2022, boasting 3,732 issuers that raised RM1.58 billion via 24,455 campaigns (2021: 1,998 issuers, RM1.14 billion raised and 14,301 campaigns). That said, campaign sizes stayed small, with 70% of the issuers raising RM50,000 or less – almost all (99%) of which was targeted as working capital.

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Eligibility Criteria for P2P Platform Providers

Any person or entity that seeks to operate a P2P financing platform must apply to be registered as a P2P operator under the SC’s Guidelines on Recognised Markets (or RMO Guidelines). All P2P operators must be locally incorporated and have a minimum paid-up capital of RM5 million. A P2P operator must also adhere to the following:

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Who Can Raise Funds Through P2P

Notably, only locally registered companies can raise funds through P2P platforms. The crowdfunding exercise is only considered successful if it reaches at least 80% of its target, and can only accept up to the targeted amount. P2P is slightly different from equity crowdfunding (ECF) in that an issuer can be hosted concurrently for different purposes on multiple P2P platforms. That said, the issuer is must disclose to the P2P operator its intention of seek concurrent funding from other P2P operators.

Only the following issuers can be hosted on a P2P platform:

Locally incorporated or registered entities:

The entities below are prohibited from raising funds through a P2P platform: 

Eligibility Criteria for P2P Investors

Investment in P2P is open to all investors, subject to the following limits:


Retail Investors

A maximum of RM50,000 per platform at any time.


Angel Investors

No restriction on investment amount.


Sophisticated Investors

No restriction on investment amount.

Market Development

In 2020, the SC launched a secondary trading framework for ECF and P2P, to provide an exit mechanism to investors. This permits early investors to exit from deals they have invested in and also offers new investors the chance to participate in the ones they may have missed earlier. 

The Government of Malaysia (GoM) had initiated the Malaysia Co-Investment Fund (MyCIF) for ECF and P2P financing under Budget 2019 – to improve access to financing for micro as well as small and medium-sized enterprises (SMEs). Such businesses usually find it a challenge to obtain financing for growth. The SC administers this fund, which was first announced in 2018 with RM50 million. The success of this fund prompted the GoM increase it by another RM50 million in 2020.

MyCIF invests in ECF and P2P campaigns on a 1:4 ratio – for every RM4 invested by others, it will pump in RM1. Its co-investment scheme is open to micro enterprises and SMEs but limited to a maximum of RM1 million per campaign. In addition, RM10 million has been earmarked for the cofunding of social enterprises, with a maximum of RM500,000 per campaign.

Registered and Recognised P2P Operators