P2P (Peer-to-Peer) Lending Compliance in Georgia is a critical area of fintech law ensuring that direct lending platforms operate within the legal framework. P2P lending involves individuals directly financing other individuals or businesses through a digital platform without bank intermediation. The development of this sector in Georgia is accompanied by growing regulatory requirements, demanding high compliance standards from platforms. Compliance is not merely a bureaucratic formality; it involves a complex system of risk management, consumer protection, and anti-money laundering measures. The National Bank of Georgia pays special attention to the transparency of P2P platforms to prevent financial pyramids and fraudulent schemes. The Legal.ge platform allows you to connect with experts who will help you build and manage a P2P lending compliance system from scratch.
What does the P2P Lending Compliance service cover?
Services related to P2P lending compliance involve legal and operational support necessary for the secure operation of the platform. The service covers: auditing and developing internal control mechanisms; drafting AML/CFT policies and setting up "due diligence" (CDD) procedures; legal validation of credit risk assessment models; implementing consumer protection standards, including disclosure of transparent interest rates and terms; adapting personal data protection rules (similar to GDPR standards); interacting with the National Bank of Georgia and the Financial Monitoring Service; and preparing regular compliance reports. Lawyers also provide assistance in creating a complaint management system, which is mandatory for protecting consumer interests.
Common real-world scenarios
In practical activities, P2P lending compliance becomes relevant during several key scenarios. The first is "Platform Launch," where a new company needs to obtain a license or register and prepare all internal regulations. The second scenario concerns the implementation of an "Auto-invest" function, where the system automatically distributes funds, requiring strict legal regulation of risks. The third scenario is "Defaulted Loan Management," where a borrower fails to fulfill obligations and the platform must ensure the recovery process on behalf of investors in full compliance with the law. It is also common for a platform to expand and offer loans to legal entities (P2B), creating additional legal requirements. Each of these cases requires a lawyer's involvement to ensure the platform's activities do not become grounds for sanctions.
Georgian Legal Framework
P2P lending compliance in Georgia is based on the Law of Georgia on Payment Systems and Payment Services and the Law of Georgia on the Securities Market. Crucial are the decrees issued by the National Bank of Georgia, regulating the activities of lending entities and crowdfunding platforms. The Law of Georgia on Facilitating the Prevention of Money Laundering and Terrorism Financing also applies, making P2P platforms obliged entities. The Civil Code of Georgia is important for defining the form and content of loan agreements. A lawyer's participation is essential for harmonizing these complex regulations so that the platform can operate effectively without legal risks.
Step-by-step process when working with a specialist
The compliance ensuring process begins with a full audit of the platform's business processes (Gap Analysis). In the first stage, the lawyer identifies discrepancies between existing practice and regulatory requirements. In the second stage, a comprehensive "Compliance Framework" is created, involving the preparation of all necessary internal documents. In the third stage, staff training in AML and ethics takes place. The fourth stage involves testing technological systems (e.g., transaction monitoring software). The process ends with implementing a continuous monitoring system and setting up communication channels with the regulator. A specialist ensures that any change in legislation is operatively reflected in the platform's operations.
Why choose Legal.ge?
P2P lending is a high-tech field where a legal mistake can be very costly. On the Legal.ge platform, you will find lawyers and compliance officers with practical experience in the Georgian fintech sector. Our experts will help you create a system that is not only law-abiding but also business-oriented and efficient. Through Legal.ge, you have the opportunity to receive qualified assistance in managing complex regulations, which will increase your platform's reliability in the eyes of investors. Find your compliance specialist on Legal.ge and ensure the sustainable development of your P2P business. Our platform offers a reliable partnership for your success.
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