CBB revises crowdfunding rules

Manama, Nov. 22 (BNA): The Central Bank of Bahrain (CBB) has expanded the scope of the services covered under the existing rules on "crowdfunding". Crowdfunding, globally, witnessed incremental growth aided by Fintech platforms. The revisions made to the existing crowdfunding rules include a reduction in minimum capital given the nature of the risk profile of the crowdfunding platform operator. The removal of the prohibition on business-to-business lending or investing through platforms, raising the limits for lending, removal of certain restrictive conditions for lending /investing; and a consumer protection mechanism whereby the lender or investor has the right to withdraw the commitment made within 48 hours from the time he /she makes a commitment to lend or invest. "We reviewed the demands placed on the business models of crowdfunding platform operators and also considered the lack of access to credit and capital for some of the smaller businesses among other factors in making these important amendments to the rules," Khalid Hamad, Executive Director at the CBB, said. The amended rules would be available on the CBB website (www.cbb.gov.bh) under relevant Modules within the CBB Rulebook Volumes 5 and 6.