The Indonesian Crowdfunding Service Association (ALUDI) expressed its optimism about the prospects of securities crowdfunding (SCF) in Indonesia despite global and domestic economic challenges.
ALUDI chairman Nandana Pawitra noted a decline in investor interest in both quantity and quality.
“The impact of our and global macroeconomic conditions is clearly felt, marked by investor interest that has not increased significantly,” Nandana told Indonesia Business Post on Thursday, November 21, 2024.
However, the association remains confident that 2025 will bring new opportunities, especially with a focus on micro, small and medium enterprises (MSMEs) as the backbone of the economy.
Securities Crowdfunding is a financing model that allows the public to invest in securities (stocks or bonds) from various companies, especially MSMEs. By utilizing a digital platform, this model opens up opportunities for MSMEs to obtain funds without going through conventional financial institutions.
ALUDI data shows that almost 70 percent of investors on the SCF platform come from Generation Z(individuals born from 1997 to 2012). This trend also applies to publishers (MSMEs), which number 65 million business actors.
“Gen Z has unique characteristics, they focus on solutions, see obstacles as challenges, and dare to take risks,” Nandana said.
Of the total 41 SCF platforms in Indonesia, 18 have secured permits from the Financial Services Authority (OJK), and 95 percent of them are driven by Generation Z.
ALUDI prioritizes the development of MSMEs to move up their class, including encouraging them to go public on the Indonesia Stock Exchange through an IPO.
“We gather fellow publishers who have the potential for an IPO, as well as inviting investors, including 136 representatives from University Students Body (BEM) inJakarta,” Nandana said.
Support from various parties, such as the Indonesia Stock Exchange, credit rating agency Pefindo, and Central Securities Depository of Indonesia (KSEI), is one of the factors supporting this optimism. However, the process towards an IPO is not without obstacles.
“Many MSME publishers feel insecure because the process requires more rigid documents and high transparency. We hope that after this moment, they will be more confident to move forward,” he added.
Regulation and investor protection
Nandana appreciated the measures taken by the Financial Services Authority (OJK) in ensuring investor protection through existing regulations, as stipulated in the P2SK Law, also known as the Omnibus Law for Financial Sector.
“Before investors invest, the platforms and publishers must comply with the rules. This provides a sense of security for all parties,” he said.
He expressed support for the government’s target eightpercent economic growth by driving SCF as one of the solutions.
“Let’s focus on that target. With good synergy between the government, regulators, and industry players, I am sure SCF can be an important instrument to support MSMEs and strengthen the Indonesian economy,” he concluded.
