Country _ Name
Crowdfunding / crowdinvesting / crowdlending
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).


Attitude of the country towards crowdfunding, crowdinvesting and crowdlending platforms

Crowdfunding is defined as “the practice of funding a project or venture by raising money from a large number of people who each contribute with a relatively small amount, typically via the internet” while crowdlending and crowdinvesting are respectively defined as a means of funding through loans given by the public or through equity and debt. These new services offer less traditional funding solutions.

Indeed, in order to diversify funding mechanisms, the French legislator adopted many laws that aimed at helping the implementation of crowdfunding, crowdlending and crowdinvesting.

The first regulation, law n°2014-559, adopted on March 30th, 2014, created numerous protection mechanisms that aimed at securing and protecting donors, which helped boost their trust in crowdfunding platforms. This eventually led to a growing recourse to such platforms by entities requiring funds for a specific project.

It is important to note that a label has been created and will be given to platforms that follow the law above and the decree that followed through, decree n° 2014-1053 adopted on the September 16th, 2014.

Moreover, another label has been created in 2017 by the Ministère de la transition écologique (The French ministry of ecological transition) in partnership with Financement Participatif France (French non-profit organisation which purpose is to the collective representation and the defence of the rights and interests of crowdfunding actors, and overall, of all the actors having an ancillary activity or supplemental or common interests with the crowdfunding) aimed at promoting crowdfunding platforms that fund "green" projects. The label will guarantee the transparency and the ecological aspect of the project.

The authorities’ response to the growing use of such platforms, specifically through the internet, showcases a friendly approach in regulation when it comes to crowdfunding and other crowd-oriented financial solutions.

This friendly approach to crowdfunding can be seen on the European level too. The European regulation 2020/1503 completed with the directive 2020/1504 relating to crowdfunding in the European Union (Regulation (EU) 2020/1503) created a unique status for crowdfunding service providers on the European market that came into force on the November 10th 2021. According to article 12 of the said regulation, this unique status will provide a European passport to the registered providers giving them the opportunity to offer services outside of France on the European Union territory. The license or registration is given by the competent national authority (the list of registrations or licenses shall be reported to the European Market Supervision authority afterwards).

Legal affairs

Obligations and requirements to provide crowdfunding, crowdinvesting and crowdlending platforms described above

First and foremost, it is required from crowdfunding service providers known as intermédiaire en financement participatif (“IFP”) to categorize their services in accordance with article L.548-1 and article L.548-2 of the CMF that define the service as linking through the internet project initiators and project funders. 

If the crowdfunding service providers happen to offer the services mentioned above, they are required by article L548-3 of the CMF to register as such with the Organisme Pour Le Registre Des Intermédiaires En Assurance (“ORIAS”).

It is important to note that only corporations can register as IFPs. Other regulated entities, such as banks or payment services providers may also render those services incidentally.

Crowdfunding services providers that offer debt, equity or mini-vouchers in order to fund a project are required to register with the ORIAS as conseiller en investissements participatifs (“CIP”) or be licensed by the ACPR (the French banking authority) as investment services providers.

Crowdfunding service providers are subject to the main following requirements:

  • To work with integrity in their relationship with their clients, serving the client’s best interests; 
  • To implement prevention mechanisms against conflict of interests;
  • To comply with good behaviour rules;
  • To comply with anti-money laundering regulation;
  • To determine the object of the project, the amount required, the schedule and the figures of spending.

Additional comments regarding the legal situation for crowdfunding, crowdinvesting and crowdlending platforms or what FinTech’s must be aware of in this business area

Crowdfunding service providers registered as IFP are under the ACPR's supervision while those registered as CIP are under the AMF's supervision and those licensed as PSI are jointly supervised by the ACPR and the AMF.

Economic conditions

Market size for crowdfunding, crowdinvesting and crowdlending platforms and biggest companies in this business area

According to Financement Participatif France in their 2021 barometer of crowdfunding, there was an exponential growth in funds through crowdfunding that attained € 1.8 billion, a growth of 84% from the year before.

Thus, the crowdfunding market seemed to be dynamic and was multiplied by 11 since 2015 to attain the cap of € 5 billion provided through crowdfunding platforms.

The market share of crowdlending was about 84% while donation-based crowdfunding took 10% of the pie and crowd investment 6%.

It’s important to note that crowdfundings aimed at funding ecological projects were a big portion of the crowdfunding scene accounting for 440 million of the collect funds, sponsoring 76,933 projects. Following through, many platforms seem to be recurrent such as October, WiSeed or Clubfunding.

Additional comments regarding the economic situation for crowdfunding, crowdinvesting and crowdlending platforms or what FinTech’s must be aware of in this business area

Crowdfunding seems to be in direct competition with other traditional financial institutions. While at first, crowdfunding was seen as a democratic alternative to traditional banking institutions, it lost some of its fervour across the years with a more and more adapted banking sector. However, this competition is not an obstacle to the growth of the sector as seen above.



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