Funding Societies, Lazada Malaysia to provide funding to SMEs

This collaboration can provide more opportunities specifically for online businesses to receive tailor-made financing products more conveniently

by NUR HAZIQAH A MALEK

PEER-TO-PEER (P2P) financing platform Funding Societies has partnered Lazada Malaysia to offer e-commerce financing, a short-term funding solution to merchants on the shopping platform.

Funding Societies co-founder and CEO Wong Kah Meng (picture) said the financing platform has heard and understood the struggles faced by e-commerce merchants when it comes to securing financing to grow their online businesses, which has oftentimes been overlooked by traditional financial institutions.

“Our partnership with Lazada will enable such merchants to gain greater access to financing via its platform. This is made possible by leveraging alternative data from Lazada, with consent, as part of our risk assessment.

“As one of the emerging pillars of our economy, P2P financing will enable greater growth within the e-commerce industry and ultimately contributing to a stronger e-commerce ecosystem,” Wong said.

Lazada CEO Leo Chow said small and medium enterprises (SMEs) play an instrumental role in further developing Malaysia’s economy and the partnership is in the right position to aid SMEs.

“As part of our commitment to create a healthy and sustainable e-commerce ecosystem, we are further reducing the entry barriers for sellers to build their own brands on Lazada.

“Providing merchants with business financing through our collaboration with Funding Societies will further add value to our already comprehensive solutions including our logistics capabilities, technology and extensive network of shoppers,” Chow said.

Funding Societies’ collaboration with Lazada can provide more opportunities specifically for online businesses to receive tailor-made financing products more conveniently.

Merchants eligible for the financing solution can enjoy benefits such as lower interest rates, retention sum requirement waivers, flexible tenure between three to 12 months, minimum document requirements and fast disbursement, whereby approval will be within five working days.

The short-term financing solution is targeted at undertaking a common issue for developing businesses, which is funding.

The solution links SMEs with investors through an online marketplace and aids sellers on the shopping platform that is looking for working capital to gain revenue growth, bridge short-term liquidity gaps and mitigate fluctuations caused by seasonal factors.

P2P is an alternative financing option which is gaining traction in recent years. It helps to narrow the funding gap by providing an alternative source of capital for local SMEs alike to fund business expansions and meet other financial requirements.

According to its press statement, Funding Societies has received as many as 500 applicants form e-merchants within just three days of launching the e-commerce financing and they expect the number to increase. Regionally, it has reached RM2 billion in total disbursed working capital to SMEs across South-East Asia since its establishment.