What Are The Advantages And Disadvantages Of Crowdfunding?

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INTERNATIONAL ORGANIZATION OF SECURITIES COMMISSION CROWDFUNDING – A GROWING INDUSTRY Abstract – The global economy is constantly evolving and changing. It is very crucial in times like this to adopt new policies and methods of financing. Crowdfunding is one such new growing method in the world today .therefore we will see what it really means and what is the potential scope of change that it may bring in the global financial landscape. Table of contents – Introduction Advantages and disadvantages of Crowdfunding Introduction – First of all , the IOSCO Research Department conducts various studies of data from places like financial centers, prominent members of the industry ,academic participants ,market participants…show more content…
CROWDFUNDING - ITS BENEFITS AND RISKS Crowdfunfing is an ideal menthid for an individual to raise large amounts of money without giving up large shares of the business or its equity. The others benefits of Crowdfunding are – • Compensate for banks – Sometimes traditional methods of lendings that banks offer are rigid and not suitable for new busineeses or for personal loams. Crowndfunfing helps in providing easy finance to these people and thus helps in compensating for the things traditional banks could not do. • Cost efficient- Crowdfunding significantly reduces the costs of a traditional banking. First of all physical presence is not required at the area of lending or in the area where it is needed. Secondly a lot of man power is saved . also the process of finding out credit worthiness of a person is done with the help of technology and various programmes and so that saves a lot of money too. • Convenience – Online platforms are very flexible and accessible to people. They can be accessed at anytime of the day and more people can access it with…show more content…
The usual physical parameters that help in security and vverifying authenticity are not as efficeinet and proper along with the fact that information is not available freely and so the risk of fraud is always prenset. This is always cupled with the fact Iosco and its principle with relation to financial Crowdfunding – Ioscos main principle and standards are set to impose regulation om the securities market. Its objective is to provide proper plans and solutions to the securities market in times of crisis and to conduct research and study in order to provide new methods and principles to help identify and protect from potential risks. These principles can be applied to the above mentioned types of Financial Return Crowdfunding and can help us understand these new methods of lending that are a growing industry in todays age. The principles of the iosco that aere relevant here are – 1. Principles relationg to the regulator- Principle 6 says that “regulator should have or contribute to a process to monitor, mitigate and manage systemic risk, appropriate to its mandate.” Principle 7 says the “regulator should have or contribute to a process to review the perimeter of regulation

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