FAQ for crowdfunding intermediaries

ACfA as an SRO has established a regulatory framework for crowdfunding which African regulatory authorities can opt to recognise formally in order to legalise and foster crowdfunding in their country. Please contact ACfA to find out the status of recognition in your country.

Even if your country has not moved to recognise this framework officially, we suggest that you join ACfA if you intend to offer crowdfunding services as an indication of your commitment to high industry standards. We will help you get the conversation started with your national regulator to increase the chances of your operation being formally permitted in your country.

The ACfA Label Framework may be integrated into, or replace, an existing regulatory framework that has been applied to crowdfunding by the national regulator if the latter is deemed insufficient or inappropriate. As a member of ACfA, a crowdfunding intermediary has the opportunity to contribute to local regulatory environment changes and amendments, through regulatory roundtable discussions, ACfA AGM attendance etc.

If a crowdfunding activity is a regulated activity and the intermediary does not have a licence or other form of permission from the relevant regulator, its activity is likely to be deemed illegal. Many regulators offer crowdfunding intermediaries a form of temporary permission to exercise their activity, such as a “sandbox” exemption or licence. In the latter case, there should be no risk to using crowdfunding; however, we recommend that you verify this before making use of a crowdfunding platform.

Should the relevant national regulators formally recognise ACfA as an SRO, they must ensure that the terms of agreement and regulations guarantee the legal validity of securities-based crowdfunding operations and therefore that there is no unknown regulatory or legal risk borne by crowdinvestors, project sponsors or crowdfunding intermediaries.

Application for membership can be completed via our Member’s Page

If you are offering the services of a crowdfunding intermediary in a country or jurisdiction in which the regulatory authorities have officially recognised ACfA and the ACfA Label Framework, then you are obliged to apply for and comply with the ACfA Label. Note: the ACfA Label is not required for donations-based and rewards-based crowdfunding platforms. You can check the status of your country’s regulations with respect to ACfA here: interactive map

ACfA works with Regulators in various ways, and these include offering the Regulators the ACfA Label Framework (ALF), that can be used by African regulators as a basis for reflection for their own regulations, or they can recognise ACfA directly as a Self-regulatory organisation (SRO) licenced and regulated by the national regulator with delegated competencies to supervise the crowdfunding industry, using the ALF. ACfA also offers training and technical advice to Regulators, and to crowdfunding intermediaries.

In a country that has fully recognized ACfA as an SRO, ACfA supervises all crowdfunding activities by:

• Registering and approving new Crowdfunding Intermediaries,

• Supervising the day-to-day operations of registered Crowdfunding Intermediaries at any time by requesting information from the latter and/or through the creation of a dedicated “ACfA” user account where applicable,

• Auditing the operations of new crowdfunding intermediaries within 12-18 months of their approval, and regular audits thereafter

• exercising internal enforcement mechanisms such as disciplinary hearings, suspensions or expulsions and fines,

In addition to ACfA’s internal enforcement, national enforcement mechanisms such as penal and financial sanctions by national regulators may also be applied.

ACfA membership allows intermediaries ecosystem members the opportunity to participate in ACfA’s Annual General Meetings and also to contribute direct feedback and ideas for the ACfA Label Framework at any time.

ACfA does not provide funding directly to any project sponsors. ACfA may enter into partnerships that it deems valuable in achieving the goals of the organisation.

ACfA does not assist individuals or organisations in their efforts to raise funds.

As a member you have access to a global network of crowdfunding organisations who can provide you with peer-to-peer guidance, and you will become part of an advocacy group to engage with Regulators, the public and other stakeholders. Other member benefits include:

• Listing in ACfA membership online directory
• Access to member insights and regulatory updates through our members-only Whatsapp group
• Access to all ACfA events, workshops and webinars
• Speaking opportunities at ACfA events and ACfA partner events
• The right to display ACfA Member logo on your website

Applications are completed via Become a Member