Crowdfunding: Should it be regulated? Department of Finance begins industry consultation

27-04-2017

Author: Orla O’Connor, Rob Cain, Kevin Lynch, David Molloy, Aiden Small, Dara Harrington, Maedhbh Clancy



On 21 April 2017, the Department of Finance announced the launch of a consultation on the regulation of crowdfunding in Ireland. The consultation will run until 2 June 2017.

What is Crowdfunding?

Crowdfunding is a method of raising finance from the public (individuals, companies and institutional investors) which is often used by start-up businesses (in particular, small and medium enterprises (SMEs)) as an alternative to traditional bank finance. A business looking to raise funds via crowdfunding will generally use an online crowdfunding platform, through which it can pitch its business plan, and raise amounts of money from multiple sources. Online crowdfunding platforms match potential investors with businesses seeking investment, coordinate payments between the parties, and may be involved in setting the interest rates in loan-based crowdfunding, or the valuation in investment-based crowdfunding.

Read the full briefing here.

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