Regulation Must Serve A Purpose

Rules and Regulations - an old document

Source: Wikimedia Commons

One of the recurring themes of crowdfunding is calls for regulation. Another Crowd believes that overall, the Financial Conduct Authority (FCA) is doing a good job, and the pragmatism, sensitivity and focus of our regulation has a lot to do with why the UK now leads the world in the adoption of crowdfunding and alternative finance.

We were pleased when the FCA resisted calls from an MP to offer stronger investor protections, because it was more important (in our view and the FCA's) to focus investors' minds on the risks they were taking.

MP Pressures Regulator Over Investor Protection

Chris Philp MP, (Conservative, Croydon South), asked the FCA to 'err on the side of caution" and provide stronger protection for investors in peer-to-peer lending. CityAM reported that the FCA had "warned p2p lenders they may face the same rules as banks" and the risk and regulatory consultancy Vedanvi reported that "Marketplace Lending could attract Basel III type Rules".

Chris Philps MP in Treasury Select Committee


FCA Needed to Overcome Funding Gap

Crowdfunding is generating excitement of “fever-pitch” levels, but it needs to be regulated by the Financial Conduct Authority (FCA), according to Richard Martin of Central Union Partners (CUP). CUP is a consultancy providing alternative financing for property projects and investments and linked to peer-to-peer platform ThinCats.