Post by SteveT on Oct 4, 2016 12:15:34 GMT
A hypothetical poll for those that lend via companies to the likes of FC / SS / AC / MT / FS / ABL / etc, triggered by a "what if" conversation last week:
AIUI, the relevant legislation currently specifies that an "FCA regulated" P2P loan contract ("36H compliant" in the jargon) can only exist between a borrower and an individual lender. Hence any P2P loan part bought by a company lender is by definition "unregulated" and, even if subsequently bought by an individual lender via a platform's Secondary Market, it remains "unregulated".
Faced with the prospect of individual lenders inadvertently, or even knowingly, holding a mix of regulated and unregulated loan parts (potentially even in the same loan), the FCA might insist before granting full FCA authorisation that platforms restructure their SMs to prevent individual lenders from purchasing unregulated loan parts. Effectively this might force the creation of a "regulated SM" that all can buy from (selling parts held by individual lenders) and an "unregulated SM" that only company lenders can buy from (selling parts held by company lenders).
My question is how would company P2P lenders react if in future they could only sell their loan parts to other company lenders? Would they be confident there'd still be sufficient liquidity in an "unregulated" secondary market (between company lenders) to carry on their lending as now? Would they reduce (or stop altogether) company lending via platforms that were obliged to operate parallel regulated and unregulated SMs? Would they reduce (or cease) company P2P lending to lend more (or solely) as individuals in future?
I appreciate it's all speculative so if my poll options aren't sufficient (tick up to 4 if the answer varies by platform) then please respond with comments instead / as well. Many thanks.
AIUI, the relevant legislation currently specifies that an "FCA regulated" P2P loan contract ("36H compliant" in the jargon) can only exist between a borrower and an individual lender. Hence any P2P loan part bought by a company lender is by definition "unregulated" and, even if subsequently bought by an individual lender via a platform's Secondary Market, it remains "unregulated".
Faced with the prospect of individual lenders inadvertently, or even knowingly, holding a mix of regulated and unregulated loan parts (potentially even in the same loan), the FCA might insist before granting full FCA authorisation that platforms restructure their SMs to prevent individual lenders from purchasing unregulated loan parts. Effectively this might force the creation of a "regulated SM" that all can buy from (selling parts held by individual lenders) and an "unregulated SM" that only company lenders can buy from (selling parts held by company lenders).
My question is how would company P2P lenders react if in future they could only sell their loan parts to other company lenders? Would they be confident there'd still be sufficient liquidity in an "unregulated" secondary market (between company lenders) to carry on their lending as now? Would they reduce (or stop altogether) company lending via platforms that were obliged to operate parallel regulated and unregulated SMs? Would they reduce (or cease) company P2P lending to lend more (or solely) as individuals in future?
I appreciate it's all speculative so if my poll options aren't sufficient (tick up to 4 if the answer varies by platform) then please respond with comments instead / as well. Many thanks.
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