Funding Societies adopts international code of conduct for self-regulation


With innovative financing methods such as
Peer-to-Peer (P2P) lending on the rise, it is essential to do so with responsible
practices. This is why, Funding Societies is proud to join other world-class P2P
lenders such as Funding Circle and Lending Club as a
signatory of the Small Business Borrowers' Bill of
Rights
(SBBOR), making us the first and only signatory in Southeast Asia.

We were created to help creditworthy SMEs
attain financing for growth, to be the ‘umbrella’ not only for shiny days but
also for rainy days. Therefore, as a signatory of SBBOR, we promise to uphold
the following:

1. The
Right to Transparent Pricing and Terms
: Rates are transparent (annualised simple
and effective interest rates are disclosed), there are no hidden fees (all fees
and charges are disclosed upfront) and all key terms are clear and
understandable to the SMEs.

2. The
Right to Responsible Underwriting
: Financing is only offered to SMEs who can
afford it. Signatories should size the loan amount based on what the SMEs
need and qualify for
, instead of offering the maximum amount to
maximise revenue. This is core to our credit assessment here.

3. The
Right to Non-Abusive Products
: We want SMEs to grow, and hence, we
consciously avoid “debt traps” and hidden penalties on our platform.

4. The
Right to Inclusive Credit Access
: We help SMEs crowdfund without
discrimination, regardless of race, language or religion, to build a funding
society.

5. The
Right to Fair Collection Practices
: When SMEs face unexpected market
shocks, they may sometimes be late for repayment by a week or a month (depending
on industry), waiting for their own customers to repay. We try our very best to
work out a fair solution for both our SMEs and lenders.

Thus, as a signatory, we self-regulate our
conduct based on international standards and we believe that P2P lending can
only achieve its fullest potential if it is “built on transparency, fairness
and putting the rights of borrowers at the centre of the lending process”, the
very spirit of the Small Businesses Borrowers’ Bill of Rights. When the rights
of SMEs are protected, the rights of lenders are protected too; since they are
two sides of the same coin.



For more information, please visit: 
responsiblebusinesslending.org/


Photo credit: Responsible Business Lending Coalition