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In our era of universal integration, in recent years especially, there has been a steady increase in interest among foreign businessmen in doing business through the registration of a fintech company in the UK. In this article, we briefly analyze the key features of digital markets and financing services in this country. A more detailed and detailed analysis of the situation can be obtained during legal advice session on FinTech regulation in the UK from IQ Decision UK specialists.

Digital Markets and Crowdfunding

Today, a lot of entrepreneurs from around the world are considering the possibility of opening a fintech company in the UK.

If you are among them, then you should know that, along with the leading global market for financial services, a powerful crowdfunding and P2P lending market is successfully operating in this jurisdiction. This market is mature, stable, and at the same time, complex, with many nuances.

Even FCA is scared a little bit by its complexity and versatility, which urged the regulator to have gathered more than one meeting of experts to finally determine whether the existing regulatory framework is relevant for compliance with high standards of business platforms. The work of platforms with the participation of retail investors has been particularly emphasized.

If you plan to launch a crowdfunding platform in England, then you should carefully read the information below.

Two-faced regulation

For unprepared foreign entrepreneurs, understanding how crowdfunding works in the UK can be very difficult. There is no clear and unambiguous regulation; it is still only in the process of formation. For example, for some actions in this area you will need permission from the FCA, but for others not.

Entrepreneurs who intend to open a crowdfunding company in England should pay attention to the following important points:

  1.  There is no direct ban on the creating of secondary markets on platforms. But there are few who wish to do so, since it carries an extra regulatory burden;
  2.  The most popular option is a platform based on venture capital. Then investors can safely leave the fund without having to look for buyers for their units.

Those wishing to register a fintech company in the UK should also take into account significant differences in the regulatory framework that apply to crowdfunding platforms created on the basis of investment and lending (or P2P).

Payment systems and banking

If you want to register a payment system in the UK and order a license for payment services received by PSR, please note that they include:

  • Payment account management;
  • Issue of bank cards;
  • Money  transfers;
  • Payment transactions.

Entrepreneurs interested in starting a Fintech business in the UK are encouraged to sign up for a one-on-one consultation on regulating payment systems in the UK.

Entrepreneurs who have decided to register FinTech company in the UK, expect favorable conditions for the development of such a business. However, do not think that running this business is a piece of cake. It is worthwhile to thoroughly study this field of activity before finally making such a decision and obtaining a license for payment services in England.

For example, it is important to know that PSD2 and PSR require banks registered in England to provide access to customer accounts and data to third parties. PISP and AISP are also third parties.

If you have any questions on this topic, we advise you to order a personal consultation on the regulation of FinTech in England from IQ Decision UK specialists, as well as legal support in obtaining a license for payment services.