P2P Lending in Italy

May 21st, 2020
5 minutes read

The Italian Market for Peer-to-Peer Lending

According to data from the latest report by Cambridge Centre for Alternative Finance on the global market of alternative finance and crowdfunding, Italy had a total funding volume of €475.5 million in 2018, up from €240.7 million in 2017. This makes Italy the fifth-largest crowdfunding market in Europe and the 15th largest crowdfunding market in the world. The countries ahead of Italy in Europe are the UK, the Netherlands, Germany, and France.

Italy’s crowdfunding volume primarily came from debt-based crowdfunding models, which represented 93% of volume raised, whereas only 4% came from equity-based crowdfunding models, and 4% from non-investment models (reward crowdfunding and donation crowdfunding). The largest business models in Italy were invoice trading with €309.1 million, P2P business lending with €67.7 million, and P2P consumer lending with €64.1 million.

Best Peer-to-Peer Lending Platforms in Italy

Here, you will find a list of the best peer-to-peer lending platforms in Italy. When choosing the best peer-to-peer lending sites in a country we consider a variety of factors that you can find in the Methodology below.

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More P2P Lending Platforms in Italy

Below, you will find a list of the remaining peer-to-peer lending platforms located in Italy. If a new platform has been launched since this article was published and you do not see it here, please feel free to submit the platform by using the submit formula.

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Taxation on Peer-to-Peer Lending in Italy

The 2018 Italian budget law changed the taxation on interest earned from investments in peer-to-peer lending from progressive taxation to a fixed withholding tax of 26%. Before this period, interest earned from P2P lending was taxed as personal income, which means the tax rate would range between 23% and 43% (excluding possible additional tax from the regional and municipal level). Thus, since 1 January 2018, most platforms have been acting as with as withholding agents charging a withholding tax of 26% on each instalment payment. This means that Italian investors will normally not have to include returns from Italian peer-to-peer lending platforms in the tax in their tax return as this is done automatically by the platform.

Keep in mind that this should not be considered tax advice and can be outdated, why you should always contact a tax adviser when handling your taxes.

You can read more about how the 2018 Italian budget law has impacted peer-to-peer lending in Italy here (in Italian).

Italien Regulation on P2P Lending and Crowdfunding

Since there is still a lack of common rules for crowdfunding in the European Union, regulation of peer-to-peer in Italy is based on national legislation though this might change in the foreseeable future as the European Commission in March 2018 presented a proposal for a regulative framework on crowd and P2P finance as part of their Fintech Action Plan. Italy was the first country in Europe to introduce specific regulation for crowdfunding, which was, however, focused on equity-based crowdfunding. Regulation on peer-to-peer lending was only recently introduced in the form of new provisions for the collection of savings from parties other than banks. Many platforms will be authorised as payment institutions supervised by the Bank of Italy.

Below, you will find an overview of some of the most important aspects of the regulatory framework for crowdfunding in Italy. These highlights can also be found in the impact assessment accompanying the proposal for a regulation on crowdfunding in the EU.

  • Bespoke Regime: Yes.
  • Scope:
  • Entry into force: 17 December 2012 (Law) and 26 June 2013 (Consob Regulation).
  • Passport: Yes if MiFID (Markets in Financial Instruments Directive) platforms. No for platforms registered under exemption (Art.3 MiFID).
  • Authorisation: Authorisation by Consob (banks and authorised investment companies do not need authorisation but must be enrolled in the Register of platforms).
  • Minimum capital requirements: None.
  • Services provided: Reception and transmission of orders.
  • Financial instruments: Shares or units (quotas) of the equity capital of innovative start-ups and innovative SMEs; units or shares of collective investment undertakings or other companies investing at least 70% in innovative start-ups and innovative SMEs.
  • KYC rules (suitability or appropriateness; AML checks): For retail investors: Appropriateness test by platforms (facultative: in alternative the appropriateness test is made by banks or investment firms which receive the orders). Investors must read the financial investor education material published on Consob’s website and state one’s awareness that the entire investment may be lost. AML checks performed by banks receiving the orders and payments.
  • Size of offer (limitations or prospectus requirements): Lower than €5 million.
  • Maximum investable amounts: No limit. Exemption from appropriateness test for investments under the following thresholds: (i) Natural persons: €500 per individual order and €1,000 in annual total orders; (ii) Legal persons: €5,000 per individual order and €10,000 in annual total orders. Based on self-declaration by investors.
  • Disclosure to investors by the issuer: Publication of information (in a short, correct and clear way, using the Consob standard form). All the information is provided by the offeror under own responsibility and there is no requirement of prior approval by Consob. Offerors allowed to use other communication tools such as films, interviews, slides, pitches.
  • Information requirements & risk warnings by platforms: Information about: activities performed; investors’ fees; taxation benefits; general risks related to crowdfunding investments For each offer, information on: risks; issuer and the financial instruments offered; the offer; services offered by the platform in relation to the offer.
  • Due Diligence: Platforms must provide detailed information on strategies for the selection of the offers to be presented on the platform.
  • Conflict of interest: Platforms must follow specific rules of conduct similar but lighter than ones provided for investment firms. Platforms must work with diligence, fairness and transparency, avoiding any conflicts of interest which could arise in the management of the platform that may affect the interests of the investors and the issuers, and ensuring equal treatment of the beneficiaries of the offers who are in identical conditions.
  • Professional requirements: Integrity requirements for the controlling shareholders. Integrity and professional requirements for the persons who perform managerial and supervisory functions.

At P2PMarketData we are dedicated to providing an unbiased overview of the Peer-to-Peer Lending market and platforms. Among other, in our mission to bring more transparency to the market for online lending we track over 70 platforms funding volumes.

When choosing the best platforms in a country we have considered a variety of factors such as:

  • Number of investors
  • Minimum investment requirement
  • Historical annual returns
  • Diversification opportunities
  • Reinvestment opportunities
  • Educational and informational offerings
  • Platform fees
  • Total capital invested
  • Features (such as secondary market and automatic investing)
  • General transparency (the difficulty of finding who the owners are, how they make money on the platform (fees), terms & conditions and more)
  • Management team

We also look into the company’s online reputation (for example customer reviews, news, complaints, average monthly searches and social media).