In The UK, Regulators Advise Where The Line Between Banks and Non-banks LiesMarch 1, 2017 | By: deBanked Staff
Online lenders shouldn’t be borrowing money from other online lenders and using that money to lend, the Financial Conduct Authority in the UK warned on Tuesday. Doing so without regulatory permission, they explained, would constitute accepting deposits and be a criminal offense.
A copy of the official letter signed by Jonathan Davidson, Director of Supervision – Retail and Authorisations, is publicly available.
According to the Financial Times, the warning was prompted after RateSetter asked the government in October 2016 if such activity was acceptable. They had been engaged in such wholesale lending, as it’s called, since 2016 but have since stopped.Last modified: March 1, 2017