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Wealth Migrate, an online investing portal in South Africa has been approved as a Category I Financial Services Provider – FSP 47394, which allows it to provide its crowdfunding offering on an intermediary services basis using shares as a financial product category.
Wealth Migrate obtains license to offer crowdfunding services to investors
According to Investopedia, crowdfunding can be defined as the use of small amounts of capital from a large number of individuals to finance a business. This form of investment raising is done through digital platforms and social media. It is a tool that enables growth in the entrepreneurship sector.
According to reports, Wealth Migrate has been in the process of obtaining this license and securing this achievement for about a decade.
Scott Picken, CEO of Wealth Migrate comments on the company securing the license to offer crowdfunding.
“To put this into perspective, we worked with the Financial Sector Conduct Authority or FSCA (formerly known as Financial Services Board) for 10 years to allow this to happen, including creating the African Crowdfunding Association [ACFA] in 2015. Wealth Migrate always had the objective to offer our crowdfunding offering to investors within a regulated environment. Obtaining our Category I licensing approval signifies the achievement of this objective. With the approval of Wealth Migrate SA’s Category I licence by the FSCA, Wealth Migrate is the leader in obtaining the relevant financial product category approval from the South African financial services industry regulator. We now have the required approval and licensing from the FSCA that allows us to offer our crowdfunding business model to investors,” Picken added.
The launch of the crowdfunding service comes at a time where the adoption of online and digital platforms has increased, allowing the concept of crowdfunding to thrive and grow.
Wealth Migrate’s crowdfunding platform
According to a statement by Elizabeth Howard, head of ACFA, Wealth Migrate is the first in the continent to be regulated for this service.
“You are not only the first in Africa to be officially regulated, but you also have the only platform which is purpose-built with our own IP and integrated into a European PSP [payment service provider] with European regulation.”
Further reports by Wealth Migrate state that the ACFA has been campaigning with many platforms from all over Africa to bring in a regulatory framework to ensure compliance.
“Now that there is someone who can work and engage with the regulator and give them peace of mind it provides a catalyst for growth for SA and the continent as a whole,” adds Picken.
The Categroy I licence provides investors with a greater sense of security due to its regulatory requirements and framework.
For Picken, obtaining the Category I licence approval allows Wealth Migrate SA to maintain its commitment to using technology to remove the middleman, cut costs and increase trust and transparency. “This allows us to pursue our purpose, which is to close the wealth gap,” he said.
Featured image: Micheile Henderson via Unsplash