What is P2P Financing? A Guide to Peer-to-Peer Financing in Malaysia

Learn how Peer-to-Peer (P2P) financing works in Malaysia, who it suits, the risks involved, and how it compares to fixed deposits and other investments.

How P2P Financing Works on microLEAP

P2P financing is a way to earn returns by funding Malaysian MSMEs through a regulated digital platform. As an Investor, you fund Investment Notes from as little as RM10 and receive returns from the Issuer's repayments.

Regulated by the Securities Commission Malaysia (SC)

Operates under the SC's P2P Financing Framework, with rules covering investor protection, disclosure, and conduct.

Digital Platform

An online platform connecting Issuers (businesses raising funds) with Investors (people funding them) through Investment Notes.

Returns Up To 18% P.A.

Earn competitive returns on your investments, significantly higher than traditional savings or fixed deposits.

Issuers Undergo Robust Credit Assessment

Every business is thoroughly vetted through microLEAP's credit scoring and risk assessment process before listing.

Hassle-Free Auto-Invest

Set your investment preferences and let the platform automatically invest on your behalf.

Funds Held in Trust

Investor funds are protected in segregated trust accounts before investment, managed by a licensed trustee.

The P2P Financing Process Explained

From Issuer application to Investor returns, here's the complete journey.

Issuer Applies

A business (Issuer) applies for funding on microLEAP, submitting required documentation and business information.

Credit Assessment

microLEAP conducts rigorous due diligence and credit risk assessment using our proprietary credit-scoring engine.

Investment Note Created

Approved businesses have Investment Notes created with details on funding amount, tenor, returns, and risk rating.

Investors Fund

Investors review notes and invest from as little as RM10, spreading their capital across multiple opportunities.

Monthly Returns

Issuers make monthly payments (principal + returns) to investors' Available Balance throughout the tenor. Some Notes use Bullet or Balloon structures instead.

Portfolio Growth

Investors receive returns, reinvest in new notes, and build a diversified portfolio over time.

Benefits of P2P Financing

P2P investment in Malaysia has clear upsides over traditional savings, but also tradeoffs. Here is what you need to know.

Higher Returns: Earn up to 18% p.a.

Significantly higher returns than traditional savings accounts or fixed deposits.

Low Entry Barrier: Start investing with just RM10

Start investing with just RM10 per Investment Note, making P2P accessible to all Malaysians.

Portfolio Diversification

Spread investments across multiple notes, industries, risk levels, and tenors to mitigate risk.

Regulated & Transparent

Regulated by the Securities Commission Malaysia (SC). Funds held in segregated trust accounts by trustees.

Credit-Assessed Issuers

All businesses undergo rigorous credit scoring and require personal guarantees.

Shariah & Conventional Options

Choose between Shariah-compliant (profit-based) or Conventional (interest-based) Investment Notes.

Tenor Flexibility

Choose Investment Notes with tenors ranging from 3 to 36 months, allowing Investors to match investments with their financial goals.

24-Hour Cooling-Off Period

Investors benefit from a 24-hour cooling-off period after investing, subject to campaign status and platform terms.

Understanding P2P Investment

Like all investments, P2P financing carries risks. Here is what to know before you invest.

Default Risk

Issuers may fail to make repayments. microLEAP mitigates this through credit scoring, guarantees, microinsurance (on Micro Financing Notes only), and collection processes.

Liquidity Risk

Investment Notes cannot be withdrawn before maturity. A 24-hour cooling-off period may apply, subject to campaign status and platform terms. Plan your liquidity needs accordingly.

Capital Risk

Investing in P2P financing is not capital-guaranteed. The Investor's principal is at risk if an Issuer defaults.

Recovery Process

Defaults can happen, but microLEAP takes all reasonable steps to recover funds, including using debt recovery agents and legal action when needed, to help return principal and returns to Investors.

Risk Mitigation Strategy

Retail investors: The SC recommends keeping total P2P financing investment up to RM50,000 at any time. Spread funds across different Notes (risk levels, sectors, and tenors) and only invest what you can afford to lose.

Sophisticated investors: There’s no SC limit, but it’s still wise to diversify and avoid putting too much into a single investment.

How microLEAP Compares

microLEAP is one of several SC-licensed P2P operators in Malaysia. Here is how it positions itself.

Regulated by Securities Commission Malaysia under the P2P Financing Framework

Proprietary credit risk engine with transparent Low, Medium to High Risk ratings

Mandatory 2 personal guarantors or a corporate guarantor.

Micro financing notes include free Personal Accident insurance up to RM50,000 for Issuers

Segregated trust accounts for Islamic and Conventional funds

Malaysia's first platform offering both Shariah-compliant and Conventional P2P Financing on one site

Active collections process with licensed debt recovery agents for defaults

0.25% default rate, the lowest among SC-regulated P2P platforms in Malaysia

Shariah governance reviewed by Masryef Advisory

Funds held with Universal Trustee (Maybank Trustees Berhad)

Bumiputera-owned Malaysian fintech, building local financial inclusion

Platform Highlights

P2P Financing at a Glance

Key numbers to know before you invest.

Returns p.a.

Up to 18%

Minimum Investment

RM 10

Tenor

3-36 months

Cooling-Off Period

24 Hours

*subject to terms

Start your investment journey from as little as RM 10 and enjoy competitive, SC-regulated returns.

FAQ

Frequently Asked Questions

Got questions? We've got answers. Learn more about P2P financing with microLEAP.

P2P financing is a way to earn returns by funding Malaysian MSMEs directly through a regulated digital platform. You fund Investment Notes from RM10, and Issuers repay you with returns over the tenor. In Malaysia, P2P financing platforms must be licensed by the Securities Commission Malaysia.

P2P investment and P2P financing refer to the same activity. In Malaysia, the SC uses "P2P financing" as the official term under its regulatory framework. Both mean funding Malaysian MSMEs through a licensed digital platform and earning returns from their repayments.

You fund Investment Notes on the Funding List. The Issuer repays principal and returns to your Available Balance based on the Note's structure (Monthly, Bullet, or Balloon). You then withdraw or reinvest. Returns go up to 18% per annum.

An Investment Note is the financing contract issued by an Issuer (the business raising funds) listed on the P2P platform. It's a debt instrument under the SC's P2P Financing Framework, setting out the Issuer's obligation to repay Investors over the agreed tenor. Each Note shows the amount, tenor, risk rating, and repayment structure upfront.

It can be, for the right Investor. Returns on microLEAP go up to 18% per annum, above typical fixed deposits. But P2P financing as an investment comes with some element of default risk, meaning the Investor's principal is at risk if an Issuer defaults. It suits Investors who understand the risk, hold to maturity, and diversify across Notes.

Fixed deposits offer lower returns with capital protected under PIDM (up to RM250,000). P2P financing funds Malaysian MSMEs directly through Investment Notes, with higher potential returns (up to 18% p.a.) but no capital protection. Returns flow per the Note's structure (Monthly, Bullet, or Balloon) instead of a single maturity date. Potential Returns — P2P Financing: Up to 18% p.a. · Fixed Deposits: Typically lower Capital Protection — P2P Financing: No · Fixed Deposits: PIDM-protected (subject to limits) Risk Level — P2P Financing: Moderate to High · Fixed Deposits: Lower Investment Access — P2P Financing: From RM10 · Fixed Deposits: Usually higher minimum deposit Liquidity — P2P Financing: Locked until maturity · Fixed Deposits: Depends on FD terms

microLEAP offers several Investment Notes that Investors can fund. Micro Financing up to RM50,000, Working Capital up to RM500,000, Invoice Financing up to RM1.5M, Purchase Order Financing up to RM1.5M, and SARANA & e-Perolehan up to RM1.5M for government procurement. microLEAP also issues a Financial Support Letter for tender bids, but it is a non-binding letter, not a Note for investment.

No. Once invested in a Note, the principal stays in until maturity. But you have a 24-hour cooling-off window to retract the investment after committing funds. Repayments credited to your Available Balance during the tenor can be withdrawn or reinvested anytime.

Spread across multiple Notes, not one. RM5,000 split across 10 Notes of RM500 each gives stronger protection than RM5,000 in one Note. A strong diversification strategy mixes risk ratings (Low, Medium, High), sectors, tenors, and Issuers. Auto-Invest can diversify for you as new Notes become available.

P2P financing carries four main risks. Default risk means Issuers may fail to repay. Liquidity risk means Notes can't be exited before maturity. Capital risk means P2P isn't capital-protected. Recovery risk means full recovery isn't assured even with collections. The SC recommends retail Investors cap total P2P financing investment at RM50,000.

Every Note is graded by microLEAP's credit risk engine: Low (LR1 to LR3), strongest credit, lowest returns; Medium (MR4 to MR7), balanced profile and returns; High (HR8 to HR10), higher returns reflecting greater default risk. The rating shows next to each Note in the Funding List, so you can match it to your risk appetite.