Yesterday the U.S. Securities and Exchange Commission (SEC) released it long-awaited rules on crowdfunding, and today the UK Financial Conduct Authority (FCA) launched its own consultation on crowdfunding.

The FCA Thursday published a consultation paper that addresses both equity and debt-based crowdfunding deals. Equity crowdfunding is already regulated in the UK, but the FCA is proposing to revise the rules to ensure that investors must be informed of the risks, and be able to withstand possible losses.

For retail investors, firms will only be allowed to promote crowdfunding platforms to: sophisticated investors, high net worth investors, retail clients who receive regulated investment advice; or, to retail clients who certify that they will not invest more than 10% of their portfolio in unlisted shares or debt securities. The FCA says that this measure reflects the fact that most investments in start-up businesses result in a complete loss (between 50% and 70% of new businesses fail in the early years, it says). For non-advised clients, firms must also assess suitability before allowing them to invest through the platform.

For debt crowdfunding, it’s proposing disclosure requirements for issuers, a 14-day cooling off period for both sides in a deal, and new prudential and resolution requirements for platforms, among other things. The FCA is taking over responsibility for consumer credit regulation in April 2014.

The FCA says that its proposals will make the crowdfunding market more accessible, will help foster competition and facilitate access to alternative finance options, and provide additional consumer protection.

“Consumers need to be clear on what they’re getting into and what the risks of crowdfunding are. Our rules provide this clarity and extra protection for consumers, balanced by a desire to ensure firms and individuals continue to have access to this innovative source of funding,” said Christopher Woolard, the FCA’s director of policy, risk and research.

The paper is out for comment until December 19, and the FCA plans to finalize its rules in February or March 2014.