FCA to introduce new rules for P2P platforms
On 4 June 2019, the FCA confirmed that it is introducing new rules for peer-to-peer platforms. The new rules are intended to protect consumers without stifling innovation in the sector. The new rules include:
- A limit on investments for retail customers new to the P2P sector of 10% of available assets;
- More explicit requirements to clarify what governance arrangements, systems and controls platforms need to have in place to support the outcomes they advertise, with a particular focus on credit risk assessment, risk management and fair valuation practices;
- Strengthening rules on plans for the wind-down of P2P platforms if they fail;
- Introducing a requirement that platforms assess investors’ knowledge and experience of P2P investments where no advice has been given to them;
- Setting out the minimum information that P2P platforms need to provide to investors;
- Applying the Mortgage and Home Finance Conduct of Business (MCOB) sourcebook and other Handbook requirements to P2P platforms that offer home finance products, where at least one of the investors is not an authorised home finance provider.
P2P platforms need to make the change relating to MCOB immediately; the other changes need to be implemented by the 9 December 2019.
The full policy statement can be read here: PS19/14