*1.5. Crowdfunding*

The European Commission defines crowdfunding as an alternative form of financing that connects those who can give, lend or invest money directly with those who need financing for a specific project and usually refers to public online calls to contribute finance to specific projects [28]. Compared to other major world economies, crowdfunding for the EU market is not well developed as the lack of common rules across member states results in compliance issues and increased operational costs. The European Commission has proposed new regulations to address the barriers to crowdfunding use by small investors and businesses. In Ireland, crowdfunding is not currently a regulated activity constituting only 0.33% to 0.4% of the small to medium sized enterprise (SME) finance market whereas in UK it constitutes 12% [29]. It is planned to regulate crowdfunding in Ireland and enact a domestic regulatory regime which is in parallel with the European Commission regulation, to create an environment for the growth of crowdfunding as one of the alternative source of finance for the Irish SMEs and also to ensure sufficient consumer protection [30].
