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FinTechs belonging to this category operate crowdfunding, crowdinvesting and crowdlending platforms on which money is raised to invest in various projects, mainly start-up companies and real estate projects.
Crowdfunding is not a defined financial service, but generally used to describe donation-based crowdfunding (the investor donates the money to the project), reward-based crowdfunding (the investor receives an often symbolic consideration for his investment), equity-based crowdfunding (crowdinvesting: the investor participates in the profits of the financed project or acquires shares or debt instruments) or lending-based crowdfunding (crowdlending: the investor is reimbursed at the end of the project with or without interest).
Introduction
Attitude of the country towards crowdfunding, crowdinvesting and crowdlending platforms
The Italian regulators recognized the potential benefits of crowdfunding such as reducing the costs of financial intermediation services, encouraging the diversification of families’ and institutional investors’ portfolios and increasing the possibilities for families and small businesses to obtain credit. Nonetheless regulators highlighted that this may also lead to offer credit to entities that are un-creditworthy, also in light of the fact that crowdfunding platforms are not incentivized to properly select the entities receiving the money. This may lead, ultimately, to increase the overall systematic risk of economy. In addition, the use of digital means may not grant proper transparency towards consumers.
The regulation on such services is evolving and it is likely that regulators will continue to pay particular attention to the activities of the operators in the market.
Legal affairs
Obligations and requirements to provide crowdfunding, crowdinvesting and crowdlending platforms described above
Under Italian law, only crowdinvesting is specifically regulated under Section 50-quinquies TUF and under Section 100-ter TUF. In particular, Section 50-quinquies provides the general rules governing the conditions to be met in order to provide the service of management of portals for the venture capital fundraising for small/medium businesses and social firms. Only offering to the public of financial instruments issued by small/medium businesses, social firms, collective investment schemes or other companies mainly investing in small/medium businesses may be carried out via crowdinvesting portals. However, pursuant to 2018 Budget Law (Law no. 145/2018), debt instruments can also be offered via crowdinvesting portals, to the extent that the offer is carried out in a separate area of the portal and the offer is addressed only to professional investors and other specific categories of investors identified by CONSOB (the relevant implementing regulations have still to be published).