Filling the Philippines' proposed 25 million peso crowdfunding cap takes 250 retail investors

A retail investor earning exactly 2 million pesos a year may commit 100,000 pesos to crowdfunded securities, because the draft keeps the 5 percent of income cap the 2019 rules set ^[6][1]. Line up 250 of those investors at their personal limit and you have filled a 25 million peso raise; under the current 10 million peso ceiling you needed 100 ^[2]. The percentages themselves did not move ^[6].

The income test has a step in it. At 2 million pesos of income the allowance is 100,000 pesos, and one peso above that the rate becomes 10 percent and the allowance is a little over 200,000 ^[6][3].

The two issuer ceilings also move closer together. Crowdfund Insider, reading the draft, puts the increase at 150 percent for general offerings and 100 percent for qualified-investor offerings ^[15], so a qualified-investor ceiling that was five times the general one becomes four times ^[4]. Both numbers cover equity and lending-based deals, since the Philippine framework treats each as securities-based crowdfunding ^[5].

On the intermediary side, the draft requires investor education on crowdfunding risk, a five-business-day cooling-off period, and investor money segregated in trust accounts ^[8][9]. Funding portals were already barred from managing investor funds or securities, from giving investment advice, and from paying people to solicit investments ^[11]. Trust accounts and a mandatory waiting period are per-campaign work, paid for out of fees on a raise that tops out at 25 million pesos, which Crowdfund Insider valued at about $430,000 ^[2].

Crowdfund Insider reports the SEC is updating the 2019 rules as online fundraising becomes a more established source of capital for startups and smaller businesses ^[4]. The report does not include figures for how much was raised under the 10 million peso ceiling, or how many issuers reached it. A ceiling nobody was pressing against can be lifted by 15 million pesos without changing a single financing ^[5].

In my view the investor-side caps and the portals' compliance costs bind before the issuer ceiling does, which would make this draft a statement of regulatory intent that shows up in deal volumes years later, if at all. The competing reading is simpler: a company that raised its 10 million pesos and wanted twice that had exactly one problem, and the draft fixes it. A third possibility is that the 100 million peso qualified-investor tier absorbs the growth while the retail tier stays small, in which case the cooling-off period and the trust accounts govern a shrinking share of the money, since qualified investors sit outside the percentage limits ^[3][7].

Comments close on 20 September, nine days after the 11 September announcement, and the regulator may rewrite the framework once it has read them ^[12][6][14].