Investment Account Platform (IAP)

www.iaplatform.com

Kuala Lumpur

Source: State Of The Islamic Economy Report 2018/19

GLOBAL ISLAMIC ECONOMY

ISLAMIC FINANCE

● Sukuk is an Islamic financial certificatethat complies with Islamic religious law.

● Breakdown of Islamic Finance Assets in2016.

● Islamic banking in Asia has seen agrowing number of new entrants, eitherby way of capitalising on conventionalsetups or new institutional setups.

DEPOSIT OUTSTANDING - MALAYSIA

Source: Bank Negara Malaysia

• Islamic Financial Services Act 2013 recognizes IA as anotherinstrument for Islamic banks to source funds from the public

“An account under which money is paid and accepted for the purposes ofinvestments, including provision of finance, in accordance with Shariah onterms that there is no express or implied obligation to repay the money in fulland (a) either only the profits or both the profits and losses (b) with or withoutany return”

Islamic Deposits• Principal-guaranteed• Funds are pooled• Risk-transfer

Investment Account (IA)• Non-guaranteed• Funds are specified• Risk-sharing

Customers

• Current Account• Savings Account• Fixed Deposits

Features

• Restricted IA • Unrestricted IA

Types

• Custody of fundsPurpose • Investment

INVESTMENT ACCOUNT or IA (IFSA 2013)

IAP was officially launched on 17 February 2016 by the former Governorof BNM, Tan Sri Dr Zeti Akhtar Aziz.

Key Point 1

New risk-reward concepts viainvestment account to benefitinvestors and entrepreneurs.

Key Point 2

As an internet-based multibankplatform, IAP provides an efficientmobilisation of funds.

IAP OFFICIAL LAUNCH

www.iaplatform.com

8

VALUE PROPOSITION TO COMPANIES / SMEs

ONE STOP CENTRE FOR

ONLINE APPLICATION

MEDIA PROFILING & MARKET EXPOSURE

NO DILUTION IN OWNERSHIP

CERTAINTY OF FUNDING

RATING AS TESTAMENT OF

FINANCIAL STANDING

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VALUE PROPOSITION TO INVESTORS

Investment is tagged against the Bank’s core business i.e. financing tobusinesses which has the following characteristics:

● Competitively priced above Bank’s cost of fund (COF) or base financingrate (BFR)

● Robust screening, account management and collection process

●

MONEY MARKET / DEPOSIT

SUKUK INCOME / SUKUK(+INVESTMENT

ACCOUNT)

REAL ESTATE

STOCKS / EQUITIES

RISK

RETURN

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VALUE PROPOSITION TO SPONSORING BANKS

INCOME

Fee-based income as intermediary

OPTIMISED COST

Savings from brokerage fee & capital charge

NEW SOURCE OF FUND

RISK MANAGEMENT

balance sheet & liquidity

management

Tap directly from the market

● Total CF world 2018USD 7 Billion

● MalaysiaECF - USD 12MP2P - USD 74M

● Network● Due Diligence● Account

Management

● Smart data● Digital tech● Agile tech-

architecture

BANKING EXPERTISE

● New economics models● Allow for risk sharing● Private/ public partnership● Malaysia as centre of Islamic Finance

LANDSCAPE

98.5% Business establishments in Malaysia are SMEs

Only 27% of SME receive financing facility from Banks

Medium, 2.3%

Small, 21.2%

Microenterprises, 76.5%

SMEs by size:

20,612 SMEs

192,783 SMEs

693,670 SMEs

66% Of the workforce from SME

907,065 establishment

SMEs by sector:

Services89.2% (809, 126 SMEs)

Manufacturing5.3% (47, 498 SMEs)

Construction4.3% (39, 158 SMEs)

Agriculture1.1% (10, 218 SMEs)

Mining & Quarrying0.1% (865 SMEs)

Source : FINANCIAL STABILITY AND PAYMENT SYSTEMS REPORT 2018 & SME Corp Report

37.1%Of GDP from SME

SMALL TO MEDIUM ENTERPRISE (SME) FACTS

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IAP MILESTONES

OVER 300 INVESTORS

13 PROJECTS

USD50 MIL RAISED

7 PARTNER BANKS

Custodian Institution

(2) Disburse fund

(3) Payment of funds + return

(1) Allocate fund &

stipulate terms of

disbursement

VENTURES CROWD & HNW

BANKS

Parties Current Method Way Forward

MOF / GOM

• Allocate funds for target sectors and entrepreneurs via various Ministries

• Funds disbursed will not be returned

• Allocate funds for target sectors and entrepreneurs

• Provide tax incentives for Investors including HNW

• Get back the funds disbursed (with returns) that can be re-used next year

Banks • With strict lending criteria, only few ventures are able to secure funding

• With MOF’s lending criteria, more ventures can secure funding

• To invite crowd / HNW to invest in the ventures by sharing the returns

• Drawdown less funds per venture basis thus more will benefit

Ventures • Most are ‘un-bankable’ thus will not benefit from the fund

• More will benefit including those ‘un-bankable’

Crowd / HNW

• Not involved • More likely to invest in the ventures in view of competitive returns and benefit from tax incentive (profit) or tax deduction (loss)

GOM

2. List venture

3. choose venture1. apply online

IAP STRUCTURE 4 (GOVERNMENT)

Investment Account Platform - IAP

@IAPIntegrated Investment Account Platform

www.iaplatform .com

THANK YOU