Lending Loop launched its peer to peer lending platform in Canada last year. In the fall, Lending Loop stated that Dentons would assist in “full compliance with all applicable provincial and federal regulations”. Today, Lending Loop is on pause as it works things out as it appears they are not pleasing regulatory officials. A notice on their platform posted on March 1st states;
“Lending Loop is currently engaged in discussions with the appropriate securities regulatory authorities to ensure that its model complies with applicable laws. As an act of good faith, we have decided to voluntarily and temporarily halt the posting of new loan requests on our website during this period. Lending Loop will, however, continue to fund loans with its own financial capital and/or the financial capital of investors of Loop Financial Inc. Additionally, Lending Loop will continue to service all funded loans during this period and all existing lending partners will be able to access their Lending Loop accounts, and withdraw available funds at no cost.”
Lending Loop expects to “be back soon” and mentions that since October 7th of last year, over 3000 Canadians have signed up on the platform to lend to SMEs.
Yesterday (March 11th), Cato Pastoll, CEO of Lending Loop, visited the studios of BNN to defend its actions and add insight into Lending Loop’s next steps.
Pastoll did not add much new information regarding the holding pattern to Disruptors Host Bruce Coxon. He dodged getting into the specifics of exactly what is happening but explained they really want to bring P2P lending (as opposed to balance sheet) to Canada as an industry that is appropriately regulated.
He said they are having a “good faith discussion with the regulatory officials”. Although they are still funding SMEs they have no idea when they will be able to go back to peer to peer lending. Pastoll quoted a study that indicates Canada is 11 years behind the curve when it comes to P2P in comparison to the UK.
You can watch the video below.