Crowdfunding Adoption in Benin: Influencing Factors and Recommendations towards an Adapted Model

Abstract

To face the problem of lack of funds, many developed countries have adopted the crowdfunding system. Despite the fact it has been established that the lack of proper funding institutions is a barrier to African countries’ economic take-off, nothing sustainable has so far been done to tackle the issue. This paper aims to investigate factors influencing crowdfunding establishment as a substitute to formal financial organism in Benin republic, and give recommendations toward an adapted model to the country. To thoroughly conduct this study, both qualitative and quantitative methods are used. In Benin, some scholars in the domain of Finance and some people that have a good view of the current state of Benin economy were interviewed to know what they think about crowdfunding and the kind of models of crowdfunding they think may be adopted by Beninese. This helped to draw a final framework of the study, a questionnaire that served to collect first-hand data that were analyzed with SPSS (Statistical Package for Social Science) Statistics 26 through various tests. The study has revealed significantly positive correlation between each independent variable and the dependent variable which is the crowdfunding implementation. It also came out that to implement a sound and sustainable crowdfunding system particular care should be on a well-built regulatory framework, a well-managed technology transfer and a well-structured organizational environment. Notwithstanding the importance of all the variables, we came to notice that for people to accept and adopt crowdfunding as the study would like, some variables like “Payment System”; “Financial Consumer Protection”; “Security Trust”; “Cyber Security”; “Creditworthiness”; “Licensing”; “Complexity”; “Accessibility”; “Availability”; “Availability”; “Regulatory Framework” are of primordial importance, then follow the other variables. Suitable recommendations were given to a more customized and sustainable crowdfunding system.