Crowdfunding as a Tool for Alternative Financing in Poland: Perspectives and Challenges

Purpose The dynamic development of the alternative finance sector is a characteristic phenomenon of contemporary times.In the literature, the key reasons identified for this phenomenon are: i. Technological advancement: The development of digital technologies, including the Internet, blockchain, and artificial intelligence, has enabled the creation of innovative financial platforms and services that are more accessible and efficient compared to traditional financial institutions (Taherdoost, 2023;Lekhi, 2024).ii.Financial exclusion issues: Many small and medium-sized enterprises, startups, and individuals have limited access to traditional sources of financing, such as bank loans, due to stringent credit requirements.This exclusion manifests as a lack of access to traditional banking services, high costs and demands of traditional financial institutions, lack of flexibility of traditional financial services, limited geographical availability of specific financial services, low financial awareness, and a lack of trust in traditional financial institutions.Alternative finance, through technological innovations and flexible business models, offers solutions that can reduce the problem of financial exclusion and provide access to essential financial services for entities previously excluded from the traditional financial system (Carb et al., 2005).iii.The search for higher returns: Investors are looking for new investment opportunities that offer higher returns compared to traditional bank deposits or bonds.Alternative forms of investing, such as crowdfunding, attract investors due to potentially higher profits (Freedman and Nutting, 2015).iv.Changes in consumer behavior in the market: The younger generation, known as Millennials and Generation Z, prefers convenient, fast, and online financial services.Young people are more open to using modern financial technologies and are less attached to traditional banks (CAsfera.pl,2022).v. Changing regulations and government policies aimed at increasing competition in the financial sector: Many governments and regulatory bodies are introducing regulations that support the development of alternative finance.These include not only regulations regarding crowdfunding but also cryptocurrencies and open banking, which promote innovation and competition in the financial sector (World Bank and Cambridge Centre for Alternative Finance, 2019).The aforementioned conditions contribute to the rapid development of the alternative finance sector, which is becoming an increasingly important part of the global financial system.In this groups.It is also worth noting that Poland has a strong community culture (e.g., "Solidarity" as a social movement in the 1980s, which played a key role in overthrowing communism in Poland and is one of the most well-known examples of a strong community and solidarity culture in Europe), which can promote the development of CF.Importantly, our research also considers the aspect of financial education, which is crucial for understanding and accepting alternative forms of financing by society.