Crowdfunding as a Financing Option for Small Contractors

• Main Authors: Omar, Ropidah, Mat Saat, Rafeah
• Format: Conference or Workshop Item
• Language: English
• Published: 2022
• Subjects: HF5601 Accounting
• Online Access: https://repo.uum.edu.my/id/eprint/29947/1/UUM%20IQRC%202022_168_175.pdf; https://repo.uum.edu.my/id/eprint/29947/

Difficulties in accessing financial support from banks and other financial institutions are the biggest challenge to small and medium enterprises (SMEs) including contractors. This paper aims to examine crowdfunding as a financing option for small contractors. A series of interviews have been carried out with nine participants including six founders and three funders. The results show that bureaucracy is one of the challenges for small contractors to obtain funding from financial institutions. The nature of their business involves various projects at the same time and needs to be completed in a short period. Therefore, faster and easier financial assistance is necessary to ensure the smooth operation of the project through crowdfunding. However, trust is the main component of this method. Funders are more selective and therefore the founders should be able to offer a viable business plan or project that promises a good return. Besides various online crowdfunding platforms available in Malaysia like ECF and P2P, this conventional crowdfunding is still preferred and being practiced among small contractors. The results of this study provide insight to the funders to choose crowdfunding as an investment opportunity and help to improve the economy of the community.