Perceived investor protection in Ghana's equity crowdfunding market: A moderated mediation model of regulatory frameworks, institutional trust, and platform governance

Edward Ampah Brient; Ben Shenglin; Abass Adams; Catherine Ampah Brient

doi:10.51867/scimundi.6.2.30

Authors

Edward Ampah Brient Zhejiang University, Hangzhou, China https://orcid.org/0000-0001-6066-8377
Ben Shenglin Zhejiang University, Hangzhou, China https://orcid.org/0000-0003-3013-9698
Abass Adams University of Education, Winneba,Ghana https://orcid.org/0000-0002-5613-605X
Catherine Ampah Brient Ghana Health Service Regional Directorate, Ghana https://orcid.org/0000-0001-6066-8377

DOI:

https://doi.org/10.51867/scimundi.6.2.30

Keywords:

Equity Crowdfunding, Ghana, Institutional Trust, Investor Protection, Platform Governance, Regulation

Abstract

Equity crowdfunding broadens access to entrepreneurial finance but also exposes retail market participants to information asymmetry and platform-related risk. This study examined whether perceived regulatory frameworks are associated with perceived investor protection in Ghana, whether institutional trust mediates that association, and whether platform governance conditions the relevant paths. Institutional and Signalling theories guided this study A quantitative cross-sectional survey obtained responses from 323 retail investors and prospective investors reached through purposive and snowball sampling. Data were collected with a structured questionnaire containing demographic items and four multi-item scales. Data were analysed with partial least squares structural equation modelling in SmartPLS 4 using 5,000 bootstrap resamples. Regulatory frameworks had a positive direct association with perceived investor protection (β = .247, p < .001). Institutional trust carried a larger indirect association (β = .315, p < .001), representing 56.1% of the total association. Platform governance strengthened the path from regulatory frameworks to institutional trust (β = .094, p = .040), but its interaction with institutional trust on perceived protection was not statistically significant (β = .083, p = .068). The conditional indirect association rose from .283 at low governance to .347 at high governance, although both interaction effects were small. The model explained 58.1% of the variance in perceived investor protection. The study concludes that formal regulation reaches perceived protection mainly because it is filtered through confidence in the institutions expected to enforce it, and that platform governance matters chiefly while that confidence is forming rather than after it is established. It recommends that the Securities and Exchange Commission Ghana publish enforcement actions, licensing status and complaint outcomes on a regular cycle; that crowdfunding intermediaries standardise disclosure, due diligence summaries, conflict of interest statements and grievance procedures; and that investor education reach the women, older adults and less digitally engaged participants underrepresented in this sample. Because the design is cross-sectional and the sample is non-probability based, the results establish associations rather than causal effects.

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