Hybrid Funding Innovation Based on Debt and Equity Collaboration for MSME Funding in North Sumatera (Journal Of Management Analytical and Solution (JoMAS))

Summary

• In Indonesia, MSMEs represent 99.99% of all business units and absorb 97% of the national workforce.p.1
• In North Sumatera, MSMEs contribute 57.8% to regional GDP, yet only 15.2% successfully obtain bank loans.p.1
• North Sumatera is home to 1.2 million MSMEs that face persistent financing access barriers.p.2
• The conceptual hybrid model provides Stage 1 validation funding through small debt facilities of IDR 50-100 million.p.4
• Securities crowdfunding under Indonesia's POJK 57/2020 permits MSMEs to raise up to IDR 10 billion per year.p.6
• The Phase 2 pilot roadmap targets onboarding 20-30 MSMEs to reach a target funding volume of IDR 5-10 billion.p.9

Key insights

1. Pure P2P lending platforms suffer from high default risks and fixed repayment schedules that strain MSMEs with volatile revenue.p.2
2. Pure equity crowdfunding faces severe valuation challenges and creates high monitoring costs for retail investors.p.2
3. A multi-instrument platform architecture can integrate P2P debt for working capital, equity crowdfunding for growth, and hybrid convertible notes.p.4
4. Dual monitoring combines automated cash flow tracking for debt with board participation and milestone reviews for equity.p.4
5. Risk mitigation mechanisms include institutional first-loss guarantees of 5-10% and mandatory reserve funds of 2-3% of outstanding principal.p.4
6. Current regulations require separate platform licensing under POJK 77/2016 for debt and POJK 57/2020 for equity, creating integration barriers.p.6
7. Proposed regulatory revisions advocate for tiered retail investor limits set at IDR 5 million for basic tier and IDR 20 million for qualified tier per MSME.p.7
8. Platform verification standards combine automated identity checks via e-KTP with manual financial statement reviews and site visits.p.8