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Business

April 18, 2017

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PSX plans crowdfunding platform for tech start-ups

PSX plans crowdfunding platform for tech start-ups

KARACHI: Pakistan Stock Exchange (PSX) on Monday signed an agreement with the Punjab Information Technology Board (PITB) to develop an online platform, enabling technology start-ups to raise capital from the bourse. 

Under the memorandum of understanding (MoU), PITB will share its database of registered start-ups with PSX so that the tech start-ups can sign up online on the ‘PSX Private Market’ aimed at bringing together start-ups and investors.

“This partnership can indeed serve as an important stepping stone for budding entrepreneurs who are looking to raise investment locally,” said Nadeem Naqvi, managing director at PSX. “This will not only encourage employment growth but also increase the technological and economic power of Pakistan.”

PSX private market will be a third-tier capital raising platform. The second-tier will be the PSX small and medium enterprise board, like PSX main board.

The objective of the private market would be to enhance access to finance for the beginners by providing them an online platform where they can sign up and register themselves. Start-ups and investors would operate on the ‘find, match and deal’ mechanism, whereby both would be connected to provide a low-cost solution to the financing needs of start-ups and liquidity placement needs of investors.

Naqvi said technology is changing the world and this sector needs to be promoted in the country. “Pakistan is a country of young people as 40 percent of the country’s population is below 18-year of age,” he said. “Our technology students and graduates are fast stepping up and we need to promote and facilitate these start-ups.” 

Omar Saif, chairman at PITB said opening up innovation for investment is the idea. Saif said starting a technology start-up is incredibly difficult in Pakistan and the collaboration between PSX and PITB would help technology start-ups to monetise their products.

“This will allow Pakistan to become an economy driven by innovation and technology,” he said.  Moreover, PSX and PITB will jointly create awareness amongst stakeholders regarding the three capital raising platforms offered by PSX as well as approach relevant regulatory bodies to advocate the case of start-ups and propose framework to assist start-ups in raising equity financing by introducing favourable listing terms particularly in terms of paid-up capital.

The parties may coordinate for exploring ways and means to initiate common business support projects and may consider organising joint events with representation from both the parties in promoting entrepreneurship.

The launch of PSX private market’s platform is contingent on the approval of PSX board of directors and the Securities and Exchange Commission of Pakistan.

 

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Comments

    Why only Punjab why not Sindh IT Board as well commented 5 months ago

    This should be extended to other provinces too

    0 0

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