The mid-noughties saw the launch of various innovative person-to-person finance platforms in the UK, US, Germany and elsewhere, which have been tracked here. These were launched by teams that spent considerable time and expense trying to accommodate existing regulation that favoured incumbents, with little or no regulatory assistance. Meanwhile, the regulatory authorities discovered that their framework, ironically designed to protect consumers, actually guaranteed the worst banking excesses and failed to contain the downside to complex "shadow banking" system in which the incumbent institutions were also involved. And although taxpayers have had to step in and effectively democratise the financial markets, we are still unable to extract badly needed funding from retail banks.

To readmore, check out Simon's blog @

http://sdj-thefineprint.blogspot.com/2011/10/new-regulatory-model-for-retail-finance.html

Simon, as if you didn't already know, is The Pragmatist.