The Malaysia Co-Investment Fund (MyCIF) has co-invested MYR 289 million ($61.4 million) via alternative financing platforms in 2023, consistently spurring growth and enhancing competitiveness of Malaysian micro, small and medium enterprises (MSMEs).

The Securities Commission Malaysia (SC) said in a statement on Thursday that the funding up 2.5 percent from MYR 282 million ($59.9 million) in 2022.

Overall, the total amount fundraised in the year 2023 reached MYR 2.22 billion ($472 million), rose 28.6 percent from MYR 1.73 billion ($368 million) in 2022.

Total amount fundraised by private investors in 2023 totalled to MYR 1.93 billion ($410 million), up 33.8 percent from MYR 1.44 billion ($306 million) in 2022.

MyCIF is a co-investment fund established by the Ministry of Finance (MoF) of Malaysia under Budget 2019 to co-invest in MSMEs through equity crowdfunding (ECF) and peer-to- peer (P2P) financing platforms.

“MyCIF has fuelled close to MYR 2 billion ($425 million) private investments via its MYR 289 million ($61.39 million) investments last year, proving to be instrumental in fostering the growth of the ECF and P2P segments,” SC Chairman Awang Adek Hussin said.

According to him, the agriculture sector in particular saw an 86 percent increase in issuers supported by the MyCIF agriculture scheme.

Furthermore, he said MyCIF was able to reach a higher proportion of MSMEs outside Klang Valley to 49 percent from 40 percent the previous year.

“This is a testament to MyCIF supporting inclusivity among MSMEs,” he added.

Since inception, MyCIF received a total allocation of MYR 250 million ($53.11 million) from Malaysian government, and successfully co-invested MYR 930 million ($197.56 million) in over 6,000 MSMEs, achieving a 3.7 times multiplier effect.

This drew in MYR 3.82 billion ($811 million) in private investments, bringing the total funds raised with myCIF’s support to MYR 4.75 billion ($1 billion).

Additionally, MyCIF has generated a net positive return on capital amounting to MYR 20.7 million ($4.4 million) or 8.2 percent of the total allocation from the MoF.

With an additional MYR 100 million ($21.24 million) allocated in Budget 2024, MyCIF said it will continue to support initiatives in focus areas namely, agriculture, healthcare, education, environment, community and Waqf asset development through State Islamic Religious Councils in tandem with the food security and sustainability agenda.

It is noted that Malaysia’s Finance Minister II Amir Hamzah Azizan emphasized earlier the need to elevate MyCIF’s profile among MSMEs and investors at national level.

Two new incentives were announced by him, for MSMEs falling within the upstream segments of the agriculture and bio-economy sector, effective until end of 2025.

These include investments at 0 percent financing rate in eligible P2P campaigns; and foregoing dividend income from investments in eligible ECF campaigns.

Malaysia’s Prime Minister Anwar Ibrahim has also recently extended these incentives to include MSMEs financing Waqf asset development projects falling within the same upstream
segment of agriculture, recognizing Waqf’s role in advancing the national food security agenda.

Building on the success of MyCIF, other co-investment schemes have been identified as a pivotal component of the SC’s 5-Year MSME Roadmap to enhance MSME and mid-
tier companies (MTC) access to the capital market.

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