Thailand issues regulations on debt crowdfunding

Thailand may see more regulations on alternative financing in the near future

Thailand’s Securities and Exchange Commission (SEC) introduced new regulations on debt crowdfunding through funding portals.

The regulations came into force on May 16 after focus groups and public consultation sessions held in January this year. They will be similar to the existing framework governing equity crowdfunding.

The debt crowdfunding framework requires the borrower to be a Thai company (SME or startup) with a clear business plan. The company is allowed to raise up to 20 million baht (roughly USD 627,000) for the first 12 months, and its capped at 40 million baht in total for proceeds from equity and debt crowdfunding combined, throughout the entire project. There is also an investment limit of 100,000 baht per business, equity and debt combined, to safeguard investors.

The move to regulate debt crowdfunding is part of the government’s effort to increase SME’s and startups’ access to funding and expand business growth, SEC assistant Secretary General Praoporn Senanarong told the Bangkok Post. 

Thailand has also been progressive in its stance towards allowing companies to raise money via ICOs, or Initial Coin Offerings. It has a licensing process for ICO portals that conduct ICOs with government oversight.

Editor: Nadine Freischlad