Overview of the Security and Exchange Commission Crowdfunding Guidelines 2024.

Overview of the Security and Exchange Commission Crowdfunding Guidelines 2024.

May 29, 2024

The Securities and Exchange Commission (SEC) has issued guidelines to regulate crowdfunding activities in Ghana. Crowdfunding is the act of raising money from the public to either finance a project or business through a crowdfunding platform. The platform can be a website, internet based portal or other technological applications or a combination of website, internet-based portal or technology applications which facilitates investment transactions between investors and issuers and other related interactions.  


The guidelines are applicable to the following:  

  1. a company or organisation seeking or required to be licensed by the Commission as a crowdfunding intermediary in accordance with the Security Industry Act, 2016 (Act); 

  1. a person who intends to raise capital using the services of a crowdfunding intermediary;  

  1. a company who intends to offer services as a crowdfunding platform in Ghana; 

  1. a foreign company or organisation that operates a crowdfunding platform and which seeks to offer services in Ghana;  

  1. a foreign person, company or organisation which seeks to facilitate, operate, maintain, or provide investments crowdfunding services in Ghana.  

However, these guidelines do not apply to reward and donation-based funding activities.  


A crowdfunding intermediary is an entity licensed by the Security and Exchange Commission (SEC) to facilitate transactions involving the offer or sale of investment instruments through a crowdfunding platform. Application for a licence as a crowdfunding intermediary is made at SEC by paying the applicable initial and annual renewal licence fee. The minimum capital requirement is Two Hundred and Fifty Thousand Ghana Cedis (GHS 250,000) and a person who wishes to be licensed as a crowdfunding intermediary shall apply for a licence for at least four representatives in accordance with the Securities Industry Guidelines 2020. The application process takes ninety (90) days after the receipt of a complete application.  

 The guidelines permit a foreign entity or crowdfunding platform to target Ghanaian investors but must satisfy the following conditions:  

  1. it has valid licence from an IOSCO recognised regulatory body;  

  1. it is registered in Ghana as an external company; and  

  1. it is duly licensed as a crowdfunding intermediary of crowdfunding platform by SEC.  

A foreign crowdfunding intermediary is operating in Ghana if it targets Ghanaian investors, or the representative of foreign entity promotes any investment activity in Ghana through direct or indirect solicitation of investors on any aspect of the offering on any public media in Ghana. It is mandatory for all funds raised by a licensed crowdfunding intermediary to be utilised in Ghana.  

To apply for a licence to operate as a crowdfunding intermediary, the company must have at least three directors including an executive director. The executive director must fulfil the following requirements:  

  1. Possession of a recognised undergraduate degree in Finance, Commerce, Accounting, Business Administration, law or any other field that is relevant to the proposed crowdfunding activities;  

  1. Must have at least five (5) years’ professional experience in a relevant role such as Micco Small Medium Enterprise (MSME) finance, fund management, MSME business development or acceleration or incubation, investment transaction advisory, management consulting or business law or other field relevant to the proposed crowdfunding activities;  

  1. Meet the fit and proper persons requirements in the Security Industry (Conduct of Business) Guidelines 2020 and the Securities Industry ( Licensing Guidelines) 2020.   

They must also put in place the following to obtain a licence to operate:  

  1. Must have in place a risk management framework or policy to manage risk associated with its business and operations. 

  1. Must have an operational manual and will be able to take appropriate action against a person in breach including directing the person in breach to take any necessary remedial measure.  

  1. Must have sufficient financial, human and other resources for the operation of the crowdfunding platform as prescribed by SEC from time to time.  

  1. The rules of the Crowdfunding Intermediary make satisfactory provisions: 

  1. for the protection of investors and public interest;  

  1. that ensure proper functioning of the market;  

  1. which promotes fairness and transparency;  

  1. to manage any conflict of interest that may arise;  

  1. which promotes fair treatment of all users;  

  1. to ensure proper regulation and supervision of its users, or any person utilizing or accessing its platform, including suspension and expulsion of such persons after consultation with the Commission; and  

  1. which provides an avenue of appeal against the decision of the intermediary.  


To ensure transparency, good corporate governance, and protection of funds of creditors, several compliance measures are instituted in the guidelines. They include the following:  

  1. to file an audited financial statement, annual reports within three (3) months of the close of the financial year as well as half year reports within twenty-one (21) days after the end of each period to SEC.  

  1. Crowdfunding intermediary that conducts fundraising for agricultural commodities shall file their annual reports within ninety days after the close of its financials containing details of their audited financial statements, total funds raised within the 12 months period, total value per crop sold in the year, total amount of profits shares, total amount of profits distributed to local and foreign investors, expenses and payment made to investors among others.  

  1. Crowdfunding intermediaries are required to keep records of information they provide to issuers and investors through the crowdfunding platform regarding notices, addressing, hours of platform operations, changes to platform operations, instructions pertaining to access to the crowdfunding platform among others. Records like KYC documents of all investors, offering documents, terms and conditions of crowdfunding platform, payment services provider and other technological applications used for the crowdfunding transactions as well as other records specified by SEC must be kept.  

  1. A crowdfunding intermediary that conducts fundraising for agricultural commodities are to keep records of project owners or executors including identification, project location, membership of relevant association, guarantors, and other relevant details.  

  1. Crowdfunding intermediaries are also to collect and approve KYC documents from issuers and investors.  

  1. They are also to comply with data protection laws and cyber security laws in Ghana.  

  1. Crowdfunding intermediaries are also expected to put in place a business continuity programme including installation of suitable back up facilities and adequately insure its operations including the platform.  

  1. They are also expected to comply with Anti money laundering and combating the financing of terrorism laws in Ghana.  

  1. They are to adopt an Information Technology system which limits the acceptable amounts to the target amount and reject additional subscriptions once the target amount is reached. This may not apply where the issuer makes a provision to issue extra securities to satisfy oversubscription in the offer document.   

  1. Crowdfunding intermediary are to appoint a Bank licensed by SEC as a custodian or a crowdfunding platform that has a contract with a custodian partner to open and operate escrow or trust account for the purpose of the crowdfunding transaction.  

Issuers and crowdfunding intermediary are to provide regular updates to investors through the crowdfunding platforms or other centralised means of communication. In the event where there are significant changes in the business model or strategy, issuers are mandated to inform investors promptly. Issuers are also required to hold virtual or physical annual meeting to which all investors are to convene in accordance with provisions of the Companies Act, 2019. It is imperative of the issuers to specify and display a minimum threshold which shall determine the success or failure of the issue.  


The guidelines allow the following investments instruments for the purpose of crowdfunding:  

  1. Equity shares;  

  1. Preference shares;  

  1. Share option agreements;  

  1. Convertible instruments;  

  1. Secured and unsecured debt;  

  1. Profit sharing agreements;  

  1. Revenue sharing agreements;  

  1. Offtake agreements;  

  1. Leasing agreements;  

  1. Factoring agreements  

  1. Rental agreements;  

  1. Repurchase or buyback agreements  

  1. Redeemable equity agreements;  

  1. Royalty agreements;  

  1. Impact linked agreement;  

  1. Sustainable, social and green debt;  

  1. Blended investment agreement and 

  1. Other instruments as shall be approved by SEC from time to time.  


An entity that seeks to raise capital using the services of a crowdfunding intermediary must be a public company incorporated in Ghana. Issuers are prohibited from raising funds through a crowdfunding intermediary when the companies have complex structures, is a public listed company, companies with no specific business plan or a blind pool, financial institution regulated by SEC, National Pensions Regulated Authority and National Insurance Commission and other entities as SEC may specify.  

The maximum amount that can be raised by an issuer within a twelve-month period shall be Six Million Ghana Cedis  (GHS 6,000,000) except where the funds are raised for agricultural commodities, physical assets or agricultural projects in which case the maximum amount can be raised by an issuer within a twelve month period is Ten Million Ghana Cedis (GHS 10,000,000). A crowdfunding intermediary that intends to raise an amount greater than the approved limit shall apply to the commission for approval. It must be noted that the maximum amounts may be revised from time to time by the Commission. 


A retail investor cannot invest more than 10% of their gross annual income across all crowdfunding offering in a twelve-month period. However qualified investors are not subject to investment this investment limit.  


Crowdfunding intermediaries are restricted to guarantee a financial return on crowdfunding investments either expressly or by an implied term. They are also not to make misleading or inaccurate statements about the issuer at any time. Providing any form of financial assistance to investors for the purpose of investing in an offer, solicitation of investments by crowdfunding intermediaries are also prohibited.  

An issuer is also restricted to issue more than one investment instrument during a single offering period, host an offering concurrently on multiple platforms as well as issuing non-fungible tokens.   


A licence holder who fails to comply with the guidelines and all other codes, circular or directive may have their licence restricted, suspended, reprimanded, or disqualified. SEC may impose an administrative penalty of not less Six Hundred Ghana Cedis (GHS 600) and not more than Two Hundred Forty Thousand Ghana Cedis (GHS 240,000) if a licence holder fails to comply with the guidelines. SEC may impose additional administrative penalty that deem fit or take remedial action that the Commission consider appropriate in the interest of protecting investors and the integrity of the security market. Where the breach or noncompliance constitute a criminal offence and the accused voluntarily makes an offer of compensation or restitution and reparation in writing to the Commission, the Commission shall without instituting criminal proceedings under Section 207 of the Security Industry Act, settle the offence in accordance with the law. A person ordered to pay an administrative penalty to SEC shall make that payment within seven (7) days or such period as the commission may specify after the order has taken effect.  



The SEC's new crowdfunding guidelines are designed to offer robust protection for investors while providing some flexibility for foreign crowdfunding intermediaries. These intermediaries could target Ghanaian investors if the funds raised are used within Ghana. Additionally, the guidelines allow for an increase in the maximum amount an issuer can raise, provided the crowdfunding intermediary gets SEC approval. 

This presents a valuable opportunity for early-stage startups, particularly those in agri-business, which often struggle to secure traditional financing. The new guidelines could open vital funding channels for these businesses, helping them to grow and thrive.