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The European Commission is working to help investors and businesses seize the potential of crowdfunding and make it easier for platforms to offer their services EU-wide.

The EU market for crowdfunding is underdeveloped compared with other major world economies. For many years, one of the biggest hurdles faced by crowdfunding platforms seeking to offer their services across borders has been the lack of common rules and diverging licensing requirements across the European Union. This has resulted in high compliance and operational costs, which prevented crowdfunding platforms from efficiently scaling the provision of their services. As a result, small businesses had fewer financing opportunities available to them and investors had less choice and faced more uncertainty when investing cross-border.

Regulation on European Crowdfunding Service Providers (ECSP) for business

On 10 November 2020, the Regulation on European Crowdfunding Service Providers (ECSP) for business entered into force. After a transition period of 12 months, the rules will enter into application on 10 November 2021, applying directly across the EU. The initiative was part of the European Commission’s fintech action plan and the mid-term review of the capital markets union action plan.

The regulation lays down uniform rules across the EU for the provision of investment-based and lending-based crowdfunding services related to business financing. It allows platforms to apply for an EU passport based on a single set of rules, which makes it easier for them to offer their services across the EU with a single authorisation.

The new rules are expected to increase the availability of this innovative form of finance, which will help companies seeking alternatives to bank financing. Investors on crowdfunding platforms, meanwhile, will benefit from an aligned and enhanced investor protection framework, based on

  • clear rules on information disclosures for project owners and crowdfunding platforms
  • rules on governance and risk management for crowdfunding platforms
  • strong and harmonised supervisory powers for national authorities overseeing the functioning of crowdfunding platforms


Report | | Directorate-General for Financial Stability, Financial Services and Capital Markets Union

Report on the development of the European crowdfunding sector, part of the capital markets union action plan.

Communication |

Communication from the Commission presenting a set of actions to unleash the potential of crowdfunding in the EU.

Consultation strategy | | Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs

Consultation launched by the Commission to explore the added value of potential EU action.