Trade body says Lending Club scandal will not impact UK P2P markets

The UK Peer-to-Peer Finance Association, which represents eight British peer-to-peer lending firms such as Zopa, RateSetter, and ThinCats has downplayed concerns that the recent Lending Club scandal will impact on the UK peer-to-peer lending market. The Association’s policy director, Robert Pettigrew, reassured investors that UK platforms are “relatively well insulated” from similar risks due to their operating principles and high levels of transparency. Furthermore he pointed out that the UK was the first country to regulate P2P business models, unlike the US which still relies on regulations which pre-date the emergence of the sector. However, multiple other reports are suggesting that online lending platforms could suffer a “serious blow” as the reputation of the sector suffers after the surprise departure of one of the sector’s best-known leaders (Lending Club CEO, Renaud Laplanche). As a result, New York’s Treasury Department has called for additional oversight and increased regulations into the online lending industry.

Concerns a major scandal in US peer-to-peer lending will impact the UK market have been downplayed by the sector’s trade body, after the chief executive of one of the biggest P2P players in the world was fired for misleading an investor.