Key takeaways
- microLEAP offers five main P2P financing solutions for Malaysian businesses, ranging from Micro Financing of RM1,000 to RM50,000 to Invoice Financing and Purchase Order Financing of up to RM1.5 million each.
- Eligibility generally requires a Malaysian-registered business with an established operating history of at least six months, although specific requirements may vary depending on the financing product and structure.
- The application process is fully online, and businesses applying for financing are referred to as Issuers on the microLEAP platform.
- The most suitable financing product will depend on the business's circumstances, financing requirements and intended use of funds.
- Preparing the relevant business, financial and supporting documents in advance can help facilitate a smoother assessment process.
Introduction
A business owner may know that P2P financing is available but still face a practical question: which type of financing is suitable for their particular needs?
The answer may depend on several factors. A business may need working capital to support daily operations, financing against an outstanding invoice, funding to fulfil a confirmed purchase order, or a smaller amount to manage immediate business requirements.
P2P financing provides an alternative avenue through which eligible businesses can seek financing from Investors via a regulated online platform.
microLEAP facilitates financing for a range of Malaysian businesses, from sole proprietorships and partnerships to private limited companies, subject to the applicable eligibility requirements and assessment process. Both Shariah-compliant and Conventional financing options are available.
This guide explains the main P2P financing products available on microLEAP, the situations they may be suited for, who may qualify, and how the application process works.
What P2P financing products are available for small businesses in Malaysia?
Image: The five P2P financing products on microLEAP.
microLEAP offers five main financing products for Malaysian businesses:
- Micro Financing: Financing amount: RM1,000 to RM50,000; Tenor: 6 to 36 months. Designed for micro enterprises and small businesses seeking smaller financing amounts, and may be used to support business requirements such as working capital, inventory purchases and other operational needs.
- Working Capital Financing: Financing amount: Up to RM500,000; Tenor: 6 to 36 months. Intended for businesses that require additional capital to support day-to-day operations, business expansion or other business-related expenses.
- Invoice Financing: Financing amount: Up to RM1.5 million; Tenor: Up to 180 days; Funding: Up to 80% of the invoice value. May be suitable for businesses with eligible and confirmed invoices issued to government-linked companies, established corporates or other approved counterparties. It can help businesses access financing against eligible receivables rather than waiting for the full payment term of an invoice.
- Purchase Order (PO) Financing: Funding amount: Up to RM1.5 million; Tenor: Up to 180 days; Funding: Up to 80% of the purchase order value. May be suitable for businesses that have received confirmed POs from credible or approved buyers and require financing to fulfil those orders. This can be particularly relevant where a business has secured a new contract but requires additional capital to purchase materials, pay suppliers or fulfil its delivery obligations.
- SARANA: Financing amount: Up to RM1.5 million; Tenor: 3 to 12 months. Designed for eligible businesses registered on ePerolehan that have secured government contracts and require financing in connection with those contracts. Specific eligibility requirements and financing terms apply.
microLEAP also provides a Financial Support Letter (FSL) for eligible businesses.
An FSL is a commitment document intended to support a business's tender or bidding process. It is not a financing facility and does not represent the disbursement of funds.
The availability of an FSL remains subject to the applicable assessment and requirements.
The right financing product will depend on the business's circumstances, the amount required, the intended use of funds and the nature of the underlying transaction.
All financing applications are subject to eligibility, assessment and approval.
For more information on specific financing options, see Micro-Financing for Small Businesses in Malaysia: How It Works & How to Qualify, and Invoice Financing for SMEs in Malaysia: How to Get Working Capital Without a Bank Loan.
Which financing product fits your business situation?
The following examples provide a general guide:
| Business Requirement | Potential Financing Option |
|---|---|
| Require up to RM50,000 for operational needs, inventory or business expenses | Micro Financing |
| Require up to RM500,000 to support working capital, business operations or expansion | Working Capital Financing |
| Have eligible and confirmed invoices from approved or established counterparties | Invoice Financing |
| Have confirmed purchase orders and require financing to fulfil them | Purchase Order (PO) Financing |
| Are registered on ePerolehan and have an eligible government contract | SARANA |
These examples are intended as a general guide only. The availability and suitability of each financing product will depend on the individual business, the proposed use of funds and the outcome of the relevant assessment.
Can a business use more than one financing product?
Potentially, yes. A business may begin with one financing product and subsequently apply for another as its financing requirements evolve.
However, each financing application is assessed independently based on the information available at the time of application. Previous approval for one financing facility does not guarantee approval for another.
All applications remain subject to the applicable eligibility criteria, credit assessment and approval.
Who can apply for P2P financing in Malaysia?
Image: Who can apply for P2P financing on microLEAP.
microLEAP financing is generally available to eligible Malaysian-registered businesses that are post-revenue and have an established operating history.
A minimum operating history of six months is generally required, subject to the requirements of the relevant financing product.
Eligible business structures may include:
- Sole proprietorships
- Partnerships
- Limited liability partnerships
- Private limited companies, or Sdn Bhd companies
- Unlisted public companies, where permitted under the applicable regulatory framework
- Subsidiaries of public-listed companies, where permitted under the applicable regulatory framework
Businesses are generally expected to have an active business bank account that can be used for transaction and verification purposes.
Depending on the financing product and business profile, applicants may also be required to provide supporting financial information, such as recent bank statements, management accounts or audited financial statements.
Personal guarantees, corporate guarantees or other security arrangements may also be required depending on the financing structure and assessment outcome.
For certain financing arrangements, repayment collections may be structured through designated or joint accounts, while financing proceeds may be paid directly to approved suppliers where applicable.
microLEAP PLT is registered with the Securities Commission Malaysia (SC) as a Recognised Market Operator. Its regulatory status can be verified through the SC register.
Eligibility applies to all business types, unless restricted by SC regulations. Eligibility requirements may vary depending on the financing product and structure. All applications are subject to credit assessment and approval.
How does the application process work?
Image: The four steps to apply for P2P financing on microLEAP.
The application process is conducted online. On the microLEAP platform, a business seeking financing is referred to as an Issuer.
The process generally involves four stages.
- Apply online. The business registers a microLEAP account, completes the relevant verification requirements and submits its financing application together with the required supporting documents. The application will typically include information such as the requested financing amount, tenor and intended use of funds.
- Assessment and credit review. microLEAP reviews the application, verifies the relevant information and conducts the applicable credit assessment. For Micro Financing, a credit decision is typically made within 3 to 5 working days, subject to the completeness of documentation and the outcome of the assessment. Other financing products may have different assessment timelines depending on the complexity of the application and transaction.
- Funding on the platform. If the financing application is approved and proceeds to be listed on the platform, the financing request will be made available to eligible Investors.
- Disbursement. Once the applicable funding requirements have been met and the relevant documentation has been completed, the financing proceeds are disbursed according to the approved financing structure. Depending on the arrangement, funds may be paid directly to the business or to approved suppliers. All applications remain subject to eligibility, credit assessment, approval, successful funding and the completion of the relevant documentation.
What fees are involved?
These are the fees for raising financing on microLEAP:
- A one-time, non-refundable application fee of RM50
- A one-time platform fee ranging from 2% to 8%, depending on the financing tenor and applicable terms
The applicable fees will be disclosed as part of the financing process before the Issuer accepts the final terms.
Businesses should review all applicable fees, financing costs and repayment obligations carefully before accepting a financing offer.
What should a business prepare before applying?
Preparing the necessary documents in advance can help facilitate a smoother and more efficient assessment process.
Depending on the financing product and business profile, applicants may be required to provide:
- Business registration documents, such as SSM registration documents, company profiles and information relating to directors and ultimate beneficial owners.
- Recent bank statements, typically including recent business or corporate bank statements.
- Supporting financial records, such as management accounts and audited financial statements where applicable.
- Relevant invoices or purchase orders, for Invoice Financing or Purchase Order Financing applications, together with supporting evidence of the underlying transaction.
- Identification documents, such as NRICs or passports for relevant directors, shareholders or ultimate beneficial owners.
- A statement on the intended use of funds, outlining how the financing proceeds will be used.
The specific documentation required may vary depending on the financing product, business structure, transaction type and operating history.
Submitting documents does not guarantee approval. All applications remain subject to verification, credit assessment and the applicable platform requirements.
Frequently asked questions about P2P financing for small businesses in Malaysia
Can I apply for P2P financing if my business is less than six months old?
Generally, no. microLEAP generally requires businesses to have a minimum operating history of six months before applying for financing. Businesses that do not yet meet this requirement may need to establish a longer operating and trading history before becoming eligible to apply. Specific eligibility requirements may vary depending on the financing product.
Can I apply for P2P financing if my bank financing application was unsuccessful?
Possibly. P2P financing platforms may apply different assessment criteria from banks. An unsuccessful bank financing application does not automatically mean that a business will be ineligible for P2P financing. However, every application is assessed based on the relevant eligibility and credit criteria. Approval is not guaranteed.
How long does it take to receive financing?
The timeline may vary depending on the financing product, the complexity of the application, the completeness of supporting documentation and the time required to achieve the applicable funding requirements. For Micro Financing, a credit decision is typically made within 3 to 5 working days, subject to assessment and documentation completeness.
The overall timeline to disbursement will also depend on the successful funding of the financing campaign and completion of the relevant documentation and processes.
What happens if my financing campaign does not reach the full target?
A financing campaign does not necessarily need to reach 100% of its target to proceed. Where applicable, if the campaign achieves at least 80% of the funding target by the end of the funding period, it may be considered successful and proceed in accordance with the applicable financing terms. If the minimum funding threshold is not achieved, the financing may not proceed and funds will not be disbursed.
Conclusion
P2P financing is one of several financing options available to Malaysian businesses. It can provide an alternative route for eligible businesses seeking financing for working capital, business operations, invoices, purchase orders or government contracts.
At microLEAP, financing options range from Micro Financing for smaller funding requirements to larger transaction-based facilities such as Invoice Financing and Purchase Order (PO) Financing.
The most suitable financing option will depend on the business's individual circumstances, financing requirements, intended use of funds and ability to meet its repayment obligations.
Both Shariah-compliant and Conventional financing options are available, subject to the applicable product structure and terms.
All financing applications are subject to eligibility, credit assessment and approval. Approval and successful funding are not guaranteed.
Before applying, businesses should carefully consider the financing amount, applicable fees, repayment obligations and suitability of the facility for their financial circumstances.
For full terms and conditions, please refer to microLEAP's Terms and Conditions.
Regulatory and advertising disclosures
This advertisement has not been reviewed by the Securities Commission Malaysia.
microLEAP PLT is registered with the Securities Commission Malaysia as a Recognised Market Operator to operate a P2P financing platform. Registration with the SC does not constitute a recommendation or endorsement by the SC of microLEAP, any financing product or any application.
Financing is subject to eligibility, identity and business verification, credit and compliance assessment, approval, achievement of the applicable funding threshold and completion of the required documentation. Approval, financing amount, rate, tenor, successful funding and disbursement are not guaranteed.
Applicable financing/profit rates, fees, taxes, charges and deductions will be disclosed in the relevant offer and final documents. Calculator results are estimates only and do not constitute an offer, approval or final financing terms.