Innovate Finance has had a busy period of lobbying both the Treasury and the Financial Conduct Authority (FCA) to cement the position of the alternative lending market.
The fintech trade body’s chief executive Janine Hirt (pictured) has revealed in an October email update that the organisation is in dialogue through its peer-to-peer lending offshoot, the 36H Group, with the FCA about potentially tighter restrictions on retail investors.
The City watchdog published a three-year strategy last month to enhance consumer protections, particularly for what it views as high-risk investments including P2P lending.
The regulator said it is aiming for a 50 per cent reduction in the number of consumers putting money into high-risk investments who indicate a low risk tolerance or demonstrate the characteristics of vulnerability, by 2025.
Over the next three years, the FCA said it would “strengthen the financial promotions regime in three areas, our classification of high-risk investments, further segmenting the high-risk market and strengthening the requirements on firms when they approve financial promotions.”
It follows a call for input (CFI) on consumer investments that the FCA published in April, seeking views on whether more types of investments should be subject to marketing restrictions and if tougher rules on financial promotions are needed.
Peer2Peer Finance News has asked Innovate Finance for further details on its dialogue with the FCA.
Innovate Finance also revealed that it has made a submission to the Treasury ahead of its Autumn Budget.
It focuses on helping the sector support the economy by creating jobs in fintech clusters and suggests adding innovation and competitiveness into the remit of regulators.
Innovate Finance also suggests that there needs to be more cross government and regulatory cohesion on the UK’s fintech strategy.