THE EUROPEAN trade body for crowdfunding, which counts Funding Circle among its members, has underlined its support for EU-wide regulation of the sector.
The European Crowdfunding Network has published an open letter detailing its views on the European Commission’s proposals.
It said that pan-EU regulation would boost financing for small- and medium-sized enterprises (SMEs); make the EU market more accessible for entrepreneurs, start-ups and SMEs; give investors across the EU a wider range of choices; and serve the aim of the EU’s Capital Markets Union to promote non-bank financing as an alternative source of funding.
“To date, significant differences in member state legislation have made crowdfunding a largely national issue,” the trade body said.
“This has meant that the vast potential for cross-border capital flows has not been tapped, leading to substantially less funding and fewer investment opportunities across the EU than would be available under a unified regime.
“Lending and investment platforms need to scale in order to compete domestically and internationally and grow into sustainable businesses. It is only through a unified set of rules, as proposed by the Commission and supported by the European Parliament, that a new regime will help create a robust and thriving sector for the benefit of both investors and SMEs across the EU.”
A number of UK companies are part of the European Crowdfunding Network, including peer-to-peer lenders Funding Circle and Rebuildingsociety, as well as Edinburgh-based P2P software provider ShareIn.