MAS simplifies regulations for securities-based crowdfunding platform... http://www.channelnewsasia.com/news/business/mas-simplifies/28544...

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MAS simplifies regulations for

securities-based
crowdfunding platforms
Among other changes, the central bank will be simplifying
checks on investors and reducing financial requirements for
platform operators, in an effort to improve companies'
access to securities-based crowdfunding while enhancing
investor safeguards.
By Nicole Tan
Posted 08 Jun 2016 12:30

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Updated 08 Jun 2016 23:22

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SINGAPORE: Upcoming regulatory changes will make it easier for

startups and small and medium enterprises (SMEs) to raise funds
on securities-based crowdfunding platforms, the Monetary Authority
of Singapore (MAS) announced on Wednesday (Jun 8).
In a statement, MAS said it is simplifying checks on investors and
reducing financial requirements for platform operators, in an effort to
improve companies' access to securities-based crowdfunding while
enhancing investor safeguards.
The authority added that it would simplify the pre-qualifications for
investors that meet certain requirements on financial competence.
These pre-qualifications currently allow issuers raising less than S$5
million within 12 months to do so without having to issue a
prospectus.
As a safeguard for investors, MAS will require platform operators to
document and disclose the key risks of securities-based
crowdfunding investments and obtain investors acknowledgement
that they have read and understood these risks, the authority said.
MAS is also reducing the financial requirements for platform
operators who want to raise funds through securities-based
crowdfunding only from accredited and institutional investors to be
licensed as dealing intermediaries, as long as they do not handle or
hold customer monies, assets or positions, and do not act as
principal against their customers.
Both the base capital requirement and the operational risk
requirement will be reduced from S$250,000 to S$50,000, while the
S$100,000 security deposit will be removed. This will allow more
platform operators to operate in this "restricted space" and takes

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In addition, the central bank will publish new guidelines on

securities-based crowdfunding-related advertising and answers to
frequently-asked questions on lending-based crowdfunding.
MAS Capital Markets Assistant Managing Director Lee Boon Ngiap
noted that while securities-based crowdfunding is a "useful addition"
to Singapore's financial landscape, such investments can be risky.
"The measures we are implementing seek to strike the right
balance, between improving access to securities-based
crowdfunding for startups and SMEs and protecting investor
interests," Mr Lee said.

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