GROWTH Street has received appointed representative (AR) status, meaning it can now accept retail investors on its platform.
This will transform the company from a business-to-business lender into a peer-to-peer finance platform that is open to consumers, as it is now on the Financial Conduct Authority (FCA)’s financial services register.
As Peer-to-Peer Finance News previously reported, Growth Street has not yet received full approval from the City watchdog. It applied for AR status with regulatory consultancy firm Resolution Compliance, which has full FCA approval.
Now that it has received the status, it is effectively operating under Resolution’s regulatory umbrella and can accept retail investors while it continues with its own FCA application.
“Individual investors will now be able to join the ranks of companies investing through Growth Street, simultaneously investing to earn an inflation beating return while helping finance the growth of great British businesses,” said James Sherwin-Smith, chief executive of Growth Street.
“Becoming an AR is an important step in the regulatory journey for Growth Street. While we continue with our application to be a regulated firm in our own right, by acting as an AR of Resolution Compliance we can increase our regulatory experience by working alongside a partner that has one of the strongest track records in an otherwise immature industry.”
James Dingwall, group chief executive for Resolution Compliance said: “We’re pleased to welcome Growth Street to the network and further facilitate the growth of the peer-to-peer lending industry.”
Growth Street uses cloud-based software to review businesses’ financial data, in order to assess credit risk. Individuals and businesses investing on the platform will get a £100 welcome bonus by investing a minimum of £1,000 for one year. Funds can be withdrawn in 30 days and are protected by a provision fund.
The platform officially launched in November 2015 and lends out between £1,000 and £500,000 to eligible businesses, at an average rate of 15 to 16 per cent.
Investors can expect returns of up to 6.5 per cent.