News Briefing - Crowdfunding, SME And Alternative Finance

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P2P Finance News reports:


“ASSETZ Capital has had almost 3,000 investors start the process of setting up an Innovative Finance ISA (IFISA), with those who have already started investing putting an average of nearly £12,000 into the product.

The peer-to-peer lender said on Tuesday that rising inflation, lacklustre interest rates and volatile stock markets are pushing investors towards P2P lending.

“With inflation still around three per cent and most bank interest rates failing to keep up, many people are voting with their feet and moving from savings to investment in order to seek a higher return, albeit with investment risk,” said Stuart Law, chief executive officer of Assetz Capital. “That means many people looking to invest in P2P lending and now the new IFISA tax-free wrapper around it.”

He added: “We’re also seeing somewhat of a setback in global stock markets with a Trump-led trade war being the current big concern and people seem to be watching for signs of the long bull run in stocks coming to an end.”

Last month, Assetz Capital said that more than 2,000 people had signed up to its IFISA since December, beating the total number of IFISA investors across the entire market for the 2016/2017 tax year. The new figure of roughly 3,000 investors taking up the IFISA represents more than 10 per cent of Assetz Capital’s 25,000-strong client base.”

2. UK – FinTech


Euromoney looks at the prospects of FinTech companies emerging as major players in the open-banking environment.


“Most new challengers are attacking retail, but a few ingenious startups are moving into the more fragmented and poorly served small business market. It is here that concepts of open banking and banking as a platform may first become real.”

3. UK – EIS/VCTs


Investment Week reports that “investors are pouring cash into tax-efficient schemes including VCTs and EIS ahead of new legislation that will ban investments into low-risk businesses from receiving generous tax breaks, which could be passed as early as 8 March.

The bill will introduce a "risk-to-capital condition", which will stop investors taking advantage of tax breaks by investing in low-risk venture capital trusts (VCTs) and enterprise investment schemes (EIS) - they will only receive tax breaks by investing in higher-risk vehicles. 

It comes after Chancellor Philip Hammond's 2017 Budget, in which he said he wanted to crack down on these schemes being used as capital preservation vehicles instead of ways to fund high-growth but high-risk businesses.”


4. UK – P2P/Real Estate


P2P Finance News reports:

“LANDBAY founder John Goodall has warned banks will struggle to lend without the cheap money from the Bank of England’s Term Funding Scheme (TFS).

The scheme, which launched in September 2016 and gave banks access to cheap money on the wholesale markets on the basis that they would lend more to borrowers, closed at the end of February.

Goodall (pictured) said mainstream banks had been propping up their lending with TFS.

“If doubling our total lending volumes in the past six months isn’t proof enough that the specialist lending model is well suited to the current climate, then the fact that traditional lenders have been propped up by the Bank of England’s Term Funding Scheme should be,” he said.

“As the scheme comes to an end and mainstream lenders can no longer rely on this source of cheap capital our proposition will become yet more competitive. I look forward to running with the opportunity this brings.”


5. US – Equity


An equity platform raises working capital for itself.


“Vancouver-based FrontFundr is the leading equity crowdfunding platform in Canada, having raised a combined total of over $8 million for Canadian businesses since launching in 2015. Wanting to grow their capacity to support even more raises, FrontFundr's management team launched the company's second equity crowdfunding campaign using their own platform on February 27. Just three days after launching, the campaign exceeded its initial target of $500,000.

"By raising capital for FrontFundr on FrontFundr, we are showing our complete commitment to our platform and process, and bringing in new investors who may consider backing other projects we have listed," said Peter-Paul van Hoeken, while speaking at the National Crowdfunding and Fintech Association of Canada (NCFA Canada) conference in Toronto on Monday. "Achieving the goal so rapidly is an endorsement of the service we offer, and the desire for our backers to help us grow and support even more Canadian companies."

FrontFundr is now continuing their campaign to achieve their maximum target of $1.5 million.”

6. International – FinTech


AtoZ Forex reports some regulatory moves in the EU:


“The EU Commission is reportedly soon to create common standards for the Blockchain technology. According to the official document from the European Commission, the agency is also looking into proposing an EU-wide licensing system for the crowdfunding platforms.

This Monday, the European Commission has informed the public it plans to create common standards for Blockchain technology across the union. As it is outlined in the EU document, the agency will also issue a draft proposal for a licensing system. The system will be used for across the EU bloc in regards to the crowdfunding platforms. The official document reads:

“An EU framework would offer a European passport, and, at the same time, ensure the proper management of platforms and the protection of fund providers.”

Instead of obtaining the authorization from each of the countries, crowdfunding platforms would receive an EU-wide approval. This would most likely reduce the costs of compliance and save time. The document also explained the EU position in regards to the Blockchain:

“An EU-wide fintech market will not reach its full potential without the development of open standards that make interoperability possible, simplify the exchange of data between market players, and facilitate competition.”


Earlier last week, we have reported that European Commission considers cryptocurrency regulations. During the roundtable talks, the European Commission Vice President Valdis Dombrovskis has stated that the development of the rules for cryptocurrency market might commence in the upcoming months. He has also suggested that the EU leaders might seek additional monitoring.

However, he has stated that such a result “depends very much on the facts and circumstance around specific crypto-tokens.” Moreover, the Commission might need to do more work in regards to this matter. Mr. Dombrovskis has been quoted as saying:

“We need to assess further under what circumstances cryptocurrencies and related services are covered by existing regulation. This depends very much on the facts and circumstances around specific crypto-tokens.”

It is also known that by the Q4 of 2018 the European Commission is apparently planning to present a “blueprint” for the regulatory sandboxes.”