Guide

Crowdfunding

Regulation of crowdfunding

Crowdfunding is mostly unregulated. From 1 April 2014, the Financial Conduct Authority (FCA) started to regulate some forms of crowdfunding in the UK.

The FCA regulates:

  • Loan-based crowdfunding: also known as ‘peer-to-peer lending’, this is where consumers lend money in return for interest payments and a repayment of capital over time.
  • Investment-based crowdfunding: consumers invest directly or indirectly in new or established businesses by buying investments such as shares or debentures.

The FCA also regulates payment services provided in connection with:

  • Donation-based crowdfunding: people give money to enterprises or organisations whose activities they want to support.
  • Pre-payment or rewards-based crowdfunding: people give money in return for a reward, service or product (such as concert tickets, an innovative product, or a computer game).

Find out more about the FCA’s crowdfunding policy and how you can protect yourself.

Download the FCA’s regulatory approach to crowdfunding over the internet (PDF, 2K).