Investors rally behind the new FCA rules
Growth Street recently undertook a survey of its investors’ opinions of the new FCA regulations set to be introduced to the peer-to-peer lending sector in December. These include an appropriateness test to gauge new investors’ understanding of what it is they are investing in, and limits on the amounts retail investors can invest in their first year.
Of the 356 respondents, 55% said they believe the changes will increase the long-term sustainability of the P2P sector. A further 25% said it will probably have no effect on it at all.
Commenting on the survey results Greg Carter, Growth Street’s CEO said:
“The results of this survey seem to match our general feeling that the new FCA rules will not impede our ability to attract ordinary investors.
“Growth Street differs from most P2P platforms by having incorporated many measures similar to the new regulations since we opened to retail investors in 2016.
“Tighter controls to protect investors, greater education and increased transparency are critical if P2P lending is to strengthen its credibility among investors. Ultimately, the regulators play an important role by protecting the interests of investors, while ensuring that the industry continues to act responsibly and grow sustainably.
“The £1,000 threshold coupled with the 10% rule works well to ensure that any customer investing can genuinely afford to invest. Any experienced investor or financial advisor will say that no more than 10% of anyone’s assets should be invested in peer to peer – these regulations simply officiate that rule-of-thumb.”