The Financial Conduct Authority (FCA) is seeking the views of a number of stakeholders on issues within the crowdfunding marketplace.
The FCA has asked participants to address key issues in the sector such as disclosures to lenders to the vehicles and whether peer-to-peer platforms review investors’ knowledge of the sector. The consultation is designed to spearhead new discussions on potential rule changes in the crowdfunding sector, which are due to begin soon.
Christopher Woolard, director of strategy and competition at the FCA, said: “The crowdfunding market is an innovative and growing sector. We introduced rules in 2014 to ensure consumers were protected without preventing the market from enhancing competition through expansion and innovation.”
In 2014, the task of regulating the crowdfunding sector was handed to the FCA, which outlined a number of rules on protecting investors such as requiring P2P lenders to be transparent about the types of companies they will lend to and to have rescue plans in the event of the platform collapsing.
According to the FCA, around £2.7 billion (€3.2 billion; $3.6 billion) was invested in the sector last year, a five-fold increase from 2013, where just £500 million was deployed.
Stakeholders have until 8 September to respond to the FCA’s consultation.