What the new P2P lending regulations mean for you

You may have seen that the Financial Conduct Authority (FCA) has recently announced new regulations for the peer-to-peer (P2P) lending industry. Below we outline what this means for you as investors and what changes will come in for P2P lending platforms more broadly.

What are the new regulations?

The FCA began regulating the P2P lending industry in 2014 and announced at the time that they would open a ‘post-implementation’ review in 2016 to assess how the regulations were working alongside innovation in the sector. At Funding Circle we’ve always welcomed regulation and worked with the FCA to raise standards across the sector.

The new regulations include new rules around what information platforms must provide to investors. We have always believed in transparency, and in helping our investors make the right decisions, and believe these rules will help to raise standards across the industry and make sure all platforms provide important information to investors.

The new regulations also introduce more robust requirements around governance and risk management, and many of the new regulations have replicated our approach to risk management and made it policy for the wider sector.

How will it affect you?

As an existing investor, you don’t need to take any action and can continue to lend to businesses as normal through your account.

More broadly, investors can expect to see more information from P2P lending platforms, helping them to make better informed decisions about which investment products are right for them.

Extra steps for new investors

After the regulations come into force on 9th of December 2019, new investors at P2P lending platforms will need to take an ‘appropriateness’ or understanding test. The FCA believes this will help to ensure customers understand how the platform that they are signing up to works, the risks involved in investing on that platform, and the nature of the investment the platform offers.

For investors who are not classed as ‘sophisticated’ or ‘high net worth’, there will also be limits on how much they can lend in their first year investing through P2P platforms. After this point, when the FCA believes investors will have a good level of understanding of how P2P lending works, investors will be able to increase their lending beyond that limit.

What happens next?

As mentioned above, you don’t need to take any action. We will be introducing the new steps outlined above over the coming months. We are also reviewing the policy statement in detail to understand whether we need to make any further changes before the 9th of December deadline to adhere to the new regulations. Should any further changes be needed, we’ll let you know in advance what they’ll be and how they will affect you.

Natalie Dormer, Michael Palin and Twiggy join Funding Circle and Just A Card to support independent bookshops

Back in November 2018, Funding Circle partnered with grass-roots campaign ‘Just A Card’ to support Indie Week – the colourful alternative to Black Friday – encouraging people to shop from independent retailers. Well, we are excited to announce that we’ve joined forces with Just A Card again and, this time, some famous faces are joining our campaign to get Britain supporting independent bookshops.

Fifteen household names have lent their support to our new campaign – called ‘Just A Book’ – to support Britain’s independent bookshops. Dominic Cooper, Natalie Dormer, Nathalie Emmanuel, Charlotte Gainsbourg, Richard E. Grant, Felicity Jones, Hanif Kureishi, Alex Lanipekun, Hayley Mills, James Norton, David Oakes, Michael Palin, Bruce Robinson, Greta Scacchi and Twiggy have all been photographed reading their favourite books, to show their support for independent bookshops.

James Meekings, Funding Circle co-founder and UK Managing Director says “Our philosophy is that when small businesses thrive, everyone benefits. Independent bookshops and retailers are important to the economy and our local communities. We want everyone to get behind this campaign.” Just A Card’s belief is that all sales – no matter how small – are vital in supporting independent businesses. “Just a book, just a card, just a gift… they all add up and are critical to small business success” says founder Sarah Hamilton. “We’re challenging shoppers to think about where they spend their money, and show how much they value the independent bookshops that make our high streets so special.”

The stars’ photographs, shot by acclaimed photographer Charlie Gray, will appear on posters on the London Underground from Monday June 17. Just A Card and Funding Circle are encouraging everyone who cares about small business to join in and support the campaign.

Join in on social media

Like and share our posts to help us spread the campaign message, and don’t forget to use the hashtag #justsupportsmall.

Follow @FundingCircleUK and @justacard on Instagram and Twitter to take part in our Treasure Hunt. Can you spot all fifteen posters around the London Underground? Share photos of the posters you spot and tag us, and you could win £100 of book tokens to spend at your favourite independent bookshop. (See full terms and conditions). Are you a bookshop or book publisher? Tell us about your business on social media and we’ll give you a shout out!

Ready to FlashMob?

If you’re in London, come along to London Bridge station on Wednesday June 19 and meet other Just A Book supporters. Follow us on social media for more details.

Support your local independent bookshop

Why not visit your local bookshop and buy a book. You’ll be supporting a small business AND you’ll improve your commute.

Support the Just A Card campaign

If you’re an independent retailer, get your window sticker and pins at www.justacard.org. We hear from retail businesses that they are changing the way people shop.