Ring-fence

A ring-fence (or ring-fencing) in P2P lending refers to the principle of segregating the investor funds from the platform’s assets. Its primary purpose is to ensure the investors’ full ownership over their funds so that, if the platform faces any financial issues or bankruptcy, investors’ assets won’t be seized or otherwise put at risk. Today, the UK and EU legislation requires all institutions that operate payment accounts to segregate non-used funds of their users. Find out more about how platforms secure your funds in our guide to ring-fence and protection of investor funds.