(Ecofin Agency) – This operation should result in the emergence of numerous crowdfunding platforms and innovative projects with strong social impact.
The participatory financing activity, also called crowdfunding, is now legal in Algeria, through the promulgation, Wednesday, October 25, of a decree setting the conditions for approval, exercise, and control of crowdfunding advisors by the government.
The document published in the official journal of the Algerian Republic stipulates that the exercise of the activity of creation and management of a platform for placing funds from the general public in participatory investment projects is subject to obtaining approval.
Companies thus approved must propose to the general public projects whose total amount does not exceed 20 million Algerian dinars ($147,000) per year and per project. Investment fund management companies, banks, and financial institutions approved as stock exchange intermediaries, as well as commercial companies created specifically for this activity, may carry out this activity.
For each crowdfunding project, the manager of the crowdfunding platform must publish the nature, the overall amount of the project, the funds to be collected by stage, the eligible investors, the method of participation, and reimbursement of the subscribed projects.
According to Yazid Benmouhoub, general director of the Algiers Stock Exchange, the promulgation of the text authorizing crowdfunding activities in Algeria will allow companies carrying innovative projects with a strong social impact to collect funds from a large audience via a platform. digital. Following the publication of this text, numerous Algerian crowdfunding platforms may emerge.
For analysts, this initiative represents a step forward in project financing in the country. However, the ceiling decided for each crowdfunding project per year remains very low.
Remember that Algeria is following in the footsteps of Morocco which, last September, published a set of texts governing crowdfunding activity in the Kingdom.
