Micro Connect has launched in Macau a global exchange for daily revenue obligations (DROs), a new asset class that connects institutional capital around the world with China’s micro and small businesses.
The Micro Connect Macao Financial Assets Exchange (MCEX) is the first licensed global exchange for DROs, which provide direct and diversified exposure to the daily and transparent cash flows of millions of stores in China’s consumer economy, while making capital more accessible and affordable to business owners, the company says.
Investment returns are collected securely via the “automated repayment mechanism”, a digital infrastructure network Micro Connect operates in partnership with brands, franchises, financial institutions, and SaaS (software as a service) companies nationwide.
The MCEX was set up in accordance with an executive order announced by Macau Chief Executive Ho Iat Seng on December 5 2022.
With a licensed exchange platform, a fund platform, and structured product solutions, Micro Connect offers efficiency and liquidity in small business investing for global professional investors and offers a new alternative to impact investing, the company says. To date, Micro Connect has provided about US$120 million of funding to more than 2,900 stores with over 200 brands nationwide.
Speaking at the launching ceremony, Micro Connect founder and chairman Charles Li says: “This is the world’s first financial market dedicated to the micro economy of China through an innovative new asset class, the DRO. By leveraging China’s leading digital economy, it will reshape the global financial landscape. New endeavours require new environments, and we look forward to Micro Connect’s contribution to connecting China’s micro and small businesses with global capital.” Li was chief executive officer of Hong Kong Exchanges and Clearing from 2010 to 2021.
Aside from MCEX and DROs, Micro Connect has also launched the world’s first exchange-traded revenue sharing product, the Micro Connect Leadership Fund, the Micro Connect Daily Cash Index, and the Micro Connect Composite Index.
Chief Executive Ho Iat Seng officiated the ceremony, along with Macau secretary for economy and finance Lei Wai Nong, Monetary Authority of Macao chairman Chan Sau San, Charles Li, Micro Connect chief executive Gary Zhang, and other key government officials of Macau. Also attending the launch were representatives of industry associations and financial institutions.
Photo: Micro Connect chairman Charles Li (left) and Macau secretary for economy and finance Lei Wai Nong at the launch of MCEX.