Minister reveals legislation to diversify business funding

April 18, 2024 2:56 pm

The government through the support of the Asian Development Bank and the Reserve Bank is pioneering a legislation to diversify financing options for businesses.

Minister for Trade, Co-operatives, Small and Medium Enterprises and Communications Manoa Kamikamica has revealed plans to introduce this legislation aimed at developing business financing.

He says the proposed law seeks to enable alternative sources of funding beyond conventional avenues.

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Kamikamica also outlined the key features of the draft Bill which garnered Cabinet approval in November last year and is undergoing public consultations.

Drawing inspiration from similar frameworks in Australia and New Zealand, the Minister states that the legislation aims to introduce innovative funding mechanisms tailored to the needs of Fiji’s growing business landscape.

Central to the proposed law are two distinct financing methods: “Small Offers” and “Crowdfunding.”

Kamikamica highlights that under the Small Offers provision, businesses will have the opportunity to secure limited capital injections, capped at $2 million from a select pool of investors including family, friends and business networks.

Crowdfunding facilitated through licensed online platforms will offer businesses the flexibility to raise funds through either equity or debt-based models.

Highlighting the regulatory framework, Kamikamica emphasized the role of RBF in overseeing Crowdfunding platforms in ensuring transparency and investor protection.

The Bill, he says mandates comprehensive disclosures from businesses seeking funding, promoting a transparent and accountable financing environment.

Expressing optimism for the legislation’s impact on SME’s, Kamikamica underlined the government’s commitment to nurturing a robust MSME sector.