The Securities and Exchange Commission of Pakistan (SECP) has granted approval to Pakistan’s first-ever tech-based crowdfunding platform for the initiation of live testing and experimentation under the 1st cohort of its technology-driven initiative, Regulatory Sandbox.
SECP Grants Approval to Pakistan’s First Tech-based Crowdfunding platform
Crowdfunding has remained one of the most revolutionary ways of procuring funds for entrepreneurs and businesses around the globe. With Pakistan having seen a massive 63 per cent increase in venture capital funding in only one year, the ecosystem is ready for even more upgradation in the domain of startup funding.
The approved crowdfunding platform will administer the demanded due diligence process on account of the investors so that only eligible issuers and applicants who fulfil the threshold criteria are able to pitch their issue via the platform and raise funds from different investors.
Furthermore, the crowdfunding business model will be examined in a live controlled environment under the SECP’s supervision for a time period of half-year. The applicant company must follow all the conditions related to the approval.
Once the testing period is completed, the applicant company shall submit a complete report to the SECP concerning the fundraising activities conducted via the platform. This comprehensive report will then decide the future course of action related to crowdfunding platforms and activities in Pakistan.
This is an excellent step in the right direction for the entrepreneurial ecosystem of Pakistan, as we can witness the success of crowdfunding platforms all over the globe.