FCA sees surge of P2P applications

The FCA has received 114 applications from peer-to-peer lenders seeking full authorisation since the start of April 2014, when the FCA took over the regulation of the consumer credit industry. Seven P2P lenders have been authorised by the FCA so far.

Bovill says that the large number of firms seeking FCA authorisation is likely to have taken the regulator by surprise, which raises questions over how well the FCA can cope with the rush of firms seeking approval.

According to information provided by the FCA to Bovill, 178 firms have obtained interim permission from the FCA, allowing those pre-existing peer-to-peer lenders to continue to operate as the regulation of the industry shifted from the Office of Fair Trading to the FCA. Many of these firms are expected to receive full FCA authorisation when their ‘landing slots’ open in August this year.

Gillian Roche-Saunders, Head of Venture Finance at Bovill, commented:

“The FCA have their work cut out for them to meet the current wave of demand from the P2P lending sector.”

“It’s difficult to see how the FCA can be expected to authorise such a large number of firms in a timely manner – as well as ensuring that the approval process is done thoroughly – unless the Government is prepared to throw increased resources at the regulator.”