Crowdfunding in the EU Capital Market Union - a Working Document recently published by the European Commission
Access to finance is one of the major concerns for young and innovative enterprises that have limited access to traditional financing through banks, particularly after the financial crisis. To survive in the global business competition, it becomes crucial to find alternative financing systems and to do that, the Capital Market Union (CMU) Action Plan seeks to strengthen the impact of different sources of alternative finance, including crowdfunding.
In Europe crowdfunding is growing rapidly: in 2014 € 1.6 billion were raised through crowdfunding platforms while in 2015 data show an impressive increase with € 4.1 billion raised.
Given the importance of this new form of financing, the European Commission has recently published a working paper on "Crowdfunding in the EU Capital Market". The aim of the publication is to assess national regimes, identify best practice and present the results of the Commission's monitoring of the evolution of the crowdfunding sector.
According to the report the contribution that crowdfunding platforms might give to the development of start-ups, young firms and in general SMEs can potentially affect the financing system and it is thus crucial for EU Member States to put appropriate regulatory measures in place.
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