Ethical investing is a key focus for crowdfunding platforms across Europe, a new report has found.
Crowdfunding research project CrowdSpace, created by technology company JustCoded, surveyed peer-to-peer lending and crowdfunding platforms in 19 countries.
It found that 27 per cent already offer green energy and impact investing opportunities, while 12 per cent solely focus on impact investing.
The report also found that 13 per cent offer investing in biotech and health alongside other sectors.
Nearly half (49 per cent) of the platforms surveyed said that they have already implemented sustainability policies and 19 per cent have them in the planning stage.
“There is a growing trend for impact and green energy investing,” the report said.
“More platforms offer this type of investment opportunities, and some focus solely on renewable energy, social impact and sustainability.”
The report also showed that there is relatively slow take-up of open banking – the data-sharing initiative that mirrors the EU’s revised payment services directive.
Only three per cent of platforms use open banking and 14 per cent said they intend to start using the initiative.
Platforms are even more hesitant around implementing blockchain technology.
75 per cent of platforms said they do not use blockchain and do not intend to, just five per cent of platforms have already implemented the technology and 20 per cent plan to in the future.
“Despite the popularity in the news, blockchain implementation is not a top priority for crowdfunding platforms, even though it may add value to real estate crowdfunding platforms that would like to offer asset tokenisation,” the report said.
The research also found that regulation is seen as a challenge by a number of platforms.
New alternative finance rules come into effect in EU in November 2021, aiming to harmonise the crowdfunding industry and enable platforms to expand across the bloc.
63 per cent of platforms said they are preparing for the new regulations, while 31 per cent said it does not concern them and six per cent said it is nowhere in their immediate plans.
“The majority of platforms we surveyed are directly authorised by the regulator,” the report said.
“Some of them admit they would like to expand in other countries, but regulations are making it more difficult at the moment.”
In June, the Cambridge Centre for Alternative Finance’s Global Alternative Finance Market Benchmarking Report found that global transactions of online alternative finance, excluding China, increased 24 per cent year-on-year to reach $113bn (£81.6bn) in 2020.