A 3 minute guide to The Peer-to-Peer Finance Association
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Transcript of A 3 minute guide to The Peer-to-Peer Finance Association
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The Peer-to-Peer Finance Association:
A 3 minute guide
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The P2PFA is the UK industry body for peer-to-peer finance.
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Hang on, what’s Peer-to-Peer
finance?
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” “ Peer-to-peer finance
platforms facilitate funding via direct contracts between
lenders and borrowers
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This revolutionary concept uses the power of the internet
to cut out unnecessary intermediaries and banks
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Businesses or consumers want to borrow money at a reasonable interest rate
Businesses or
consumers
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Investors
Investors and savers want to get a good return on their
money
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P2P platform
Businesses or
consumers Investors
£! £!
The platform connects the two
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P2P platform
Businesses or
consumers Investors
£! £!
and then enables repayment
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Peer-to-Peer platforms have experienced extraordinary growth since the concept
emerged in 2005
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£0
£100
£200
£300
£400
£500
£600
£700
£800
£900
£1,000
2010 2011 2012 2013
Mill
ions
Cumulative gross lending data
for P2PFA members
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In 2013 these companies grew by
Read more stats on the P2PFA website >>>
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The Peer-to-Peer Finance Association was set up to ensure high standards in this fast-growing industry
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It was founded in August 2011
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There are now 8 members
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So what’s involved in being
a member?
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All members of the P2PFA must adhere to the rules and operating principles drawn up by the association
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Rule #1
All members have to maintain a minimum amount of funds to maintain stability
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Rule #2
Members have to keep their clients’ funds separate to
their own
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Rule #3
Members have to lend responsibly and manage credit risk
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Rule #4
Transparency
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Members have to communicate to their clients: • Likely default rates • Terms of the product • Risks and likely returns • Fees and charges
Transparency
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Each member must ensure that clear, fair and not misleading information is published on their website
Transparency
” “
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Rule #5
Members have to make sure their IT systems are secure
and reliable
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Rule #6
Members must have a clear complaints handling policy
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” “
Rule #7
Each member must make arrangements to ensure the orderly administration of its customers’ contracts in the event that their platform ceases to operate
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Christine Farnish is the independent Chair of the P2PFA, having previously worked as Consumer Director at the FSA
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2014 is a big year for the P2PFA, with the FCA bringing in regulation for P2P finance and crowdfunding from April 1st
Read more on the P2PFA website >>>
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As the association’s newest member, MarketInvoice is proud
to adhere to the P2PFA’s rules and shares its commitment to transparency and innovation
Read more on the MarketInvoice website