Peer-to-Peer Lending and the Future of Alternative Finance in Canada
|Area||Banking and Finance Law, Technology|
The Canadian financing industry is changing alongside developments in technology and communication. New businesses are shifting away from traditional lending institutions and are funding early growth through alternative finance. Market participants who historically sought investments from angel investors, private equity funds and banks are obtaining capital elsewhere. The financing industry has embraced the sharing economy model and is connecting retail users through different models. One such model is the “lending-based” crowdfunding model (often referred to as Peer-to-Peer or P2P lending) which allows members of the “crowd” to lend capital without using traditional financial intermediaries such as large banks.