the total value of loaned funds outstanding on that date; and
the sum of:
0.2% of the first £50 million of that total value;
0.15% of the next £200 million of that total value;
0.1% of the next £250 million of that total value; and
0.05% of any remaining total value.
The total value of loaned funds outstanding is the total amount of funds that are currently being provided to borrowers under P2P agreements through an operator of an electronic system in relation to lending.
To determine a firm’s financial resources requirement for the period beginning on the date on which it obtains a Part 4A permission and ending on the day before its next accounting reference date, the firm must carry out the calculation in IPRU-INV 12.2.4R(2) on the basis of the total value of loaned funds the firm projects will be outstanding on the day before its next accounting reference date.
If the firm has 30,000 individuals each lending £100,000, the total value of the firm’s loaned funds outstanding is £3,000,000,000. If the firm does not carry on any other regulated activity to which another higher financial resources or own funds requirement applies, its financial resources requirement is £1,900,000. This is calculated as follows:
0.2% x £50,000,000 = £100,000;
0.15% x £200,000,000 = £300,000;
0.1% x £250,000,000 = £250,000;
0.05% x £2,500,000,000 = £1,250,000.
If the firm experiences a greater than 25% increase in the total value of loaned funds outstanding compared to the value used in its last financial resources requirement calculation, it must recalculate its financial resources requirement using the higher total value of loaned funds outstanding.
A firm must notify the FCA of any change, or any likely change, in its financial resources requirement within 14 days of that change, or it becoming aware that the change is likely, whichever is the earlier.