The Stock Exchange of Thailand (SET) expects to launch LiVE Exchange, a fundraising platform for small and medium-sized enterprises (SMEs) and startups by the end of this year or the beginning of next year to give SMEs greater access to the capital market.
The development is in line with the 20-year National Strategic Plan (2018-37) which aims to enhance SMEs' potential.
It is expected that SMEs and startups will contribute up to 60% of GDP in 2037.
Manpong Senanarong, senior executive vice-president and head of issuer and listing division of the SET, said 30 SMEs are ready and have expressed an interest in joining.
He said the exchange will be open for trading only 90 minutes per day and trading orders will be matched or settled once a day.
The SET will also allow institutional investors and qualified high-net-worth investors to trade in the bourse as they are experienced investors with high risk tolerance, Mr Manpong said.
Ruenvadee Suwanmongkol, secretary-general of the Securities and Exchange Commission (SEC), said SMEs are an important engine driving the economy, especially in terms of job creation.
According to the SEC, there are currently over 3.1 million SMEs which employ over 12.7 million people across the country. They are also a source of innovation, she said.
The GDP value of SMEs in the first quarter amounted to 1.41 trillion baht, accounting for 34.7% of total GDP.
The new exchange is a part of the SEC's and SET's roadmap to increase SMEs' and startups' access to financial services and low-cost fundraising from the capital market.
"We aim to help SMEs raise funds through the capital market by 10-16% from 2018-37. This is in line with the Thai Capital Market Development Plan No. 3 [2017-21], which has targeted to support SMEs to reach funding resources from the capital market," Ms Ruenvadee said.
She said in the past SMEs and startups had difficulties accessing funds in the capital market due to legal restrictions and less access to investment information.
The regulator has revised the law to provide a more flexible fundraising process for SMEs.
The revision allows SMEs to raise funds in a variety of ways, such as issuing debentures via the crowdfunding system, which has already been successful for 75 companies with a total fundraising value of over 562.3 million baht.
