FCA reveals P2P lending platform application backlog
31 March 2016 | 7725 views | 0
The UK's peer-to-peer lending goldrush is causing a headache for the Financial Conduct Authority, which has put out a statement revealing it has a backlog of 86 firms awaiting authorisation to operate.
With the government embracing P2P platforms as a way of introducing competition into the market, the FCA has been inundated with applications.
The watchdog says that just eight firms have been fully authorised to operate P2P platforms, with a further 86 awaiting a decision - although 44 of these have "interim permission" because they were previously licensed by the Office of Fair Trading.
The backlog means that most firms will not immediately be able to offer the new Innovative Finance Isa, which launches next week and will let people invest in P2P loans while benefitting from the tax-free Isa wrapper.
The FSA has up to 12 months to decide on applications but says that how long it takes depends on the completeness of the application, the complexity of the business, and the firm’s demonstrated compliance with regulatory requirements.
It says it is taking a "proportionate approach to regulation", adding: "We are working closely with individual firms to ensure they meet the rigorous statutory standards and are authorised as quickly as possible."