Awareness and Challenges of Crowdfunding among Small and Medium Enterprises in Akure, Nigeria
The study accesses the level of awareness and challenges of crowdfunding as financing options for SMEs. The study adopts survey research design. The findings reveal that awareness is low as only 42% of respondents indicate their awareness (knowledge and understanding) of what crowdfunding is all about. Again, out of 42% of the crowdfunding-aware respondents, only 8% of them have access to only two crowdfunding platforms- donation and reward with 6% and 2% access respectively. Thus, the study reveals a significant gap between crowdfunding awareness and actual participation or impact. Findings also show that potential challenges include lack of regulatory frameworks to protect investors against fraud, among others. The study concludes that as a result of the existing gap in SMEs financing, crowdfunding should be strongly considered as a feasible alternative. The study recommends that government should review and update SMEs regulations to balance the need for investor protection in crowdfunding. Realising that not all projects attract donors, SMEs should develop innovative and creative projects with high compelling need for value creation.
Keywords - Crowdfunding, Awareness, Challenges, SMEs, Alternative Financing Mechanism.