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Funding Societies | Modalku is the largest debt crowdfunding platform in Southeast Asia. It is licensed in Singapore, Indonesia and Malaysia, and backed by Sequoia India and Softbank Ventures Asia Corp amongst many others. It provides business financing to small and medium-sized enterprises (SMEs), which is crowdfunded by individual and institutional investors. In 4 years, it has helped finance over 1.4 million business loans with over S$1.2 billion in funding. It was awarded the MAS FinTech Award in 2016, the Global SME Excellence Award at the United Nations’ ITU Telecom World in 2017, Fintech Top 100 by KPMG in 2018 and Brands for Good in 2019.
Funding Societies provides investment opportunities into notes issued by SMEs for financing facilities such as Property-backed Secured Financing, Business Term Loans and Invoice Financing. The interest charged to the SMEs is the return on investment for the investors who co-invest into the notes through the crowdfunding platform. For certain investments such as the Property-backed one, SMEs need to provide a residential or commercial property, usually with a first charge. Also, certain investments are guaranteed for both principal and interest.
Default by the issuer is the primary risk that investors get exposed to with this type of investment. Funding Societies conducts a detailed assessment on the SMEs based on a framework which combines a mixture of hard and soft data including but not limited to credit bureau ratings, bank & financial statements, cash flow projections, site visits, strength of guarantors, marketability of collaterals and business's capacity to repay the facility.
Specifically for Property-backed collaterals such as residential or commercial properties owned by the issuers or guarantors are held to mitigate credit risk exposures
Investors’ funds are handled by a 3rd party escrow agency, Vistra.
The minimum investment for Funding Societies is S$20.