A new UK stock exchange where people can trade shares in private companies is moving closer, after officials published details on how it could operate.
Regulators are consulting on the new market, called Pisces, for which ministers will legislate next year.
Pisces will allow investors to trade shares in private firms in a style similar to a public exchange like the FTSE 100.
It was introduced by the last Conservative government in a bid to breathe new life into London’s struggling stock market system.
The Financial Conduct Authority said on Tuesday that it will give people more confidence to invest in smaller companies.
It will give investors the chance to get in on the ground floor of some of the most exciting companies and support the growth of those businesses
In turn, those companies will get more access to funding which will help them expand.
Pisces will be open to professional investors, and select retail traders like high net worth individuals and employees of participating private firms will also be included.
Normal retail investors will not be able to take part at first.
Tulip Siddiq, Economic Secretary to the Treasury, said it is a “significant step forward” in Labour’s plans to reform markets.
“It will give investors the chance to get in on the ground floor of some of the most exciting companies and support the growth of those businesses.”
Last month, Chancellor Rachel Reeves announced plans for the market in her maiden speech at Mansion House.
Next year we will ring the bell on a new private stock market that could transform how private companies access funds and grow
Pisces stands for Private Intermittent Securities and Capital Exchange System.
The FCA said it is inviting views from potential participating companies and finance firms on how to regulate the market.
The consultation will run until February 17.
Simon Walls, interim executive director of markets at the FCA, said: “Next year we will ring the bell on a new private stock market that could transform how private companies access funds and grow.
“It will offer investors more access and a greater confidence to invest in private companies and could act as a stepping stone to public markets for those firms.
“We want to work with industry and ensure we have the right building blocks in place to support investment in growing companies.”
Dame Julia Hoggett, chief executive of the London Stock Exchange, said the plan was “a truly innovative and tailored framework that supports the funding continuum across public and private markets”.
Other reforms put forward by Labour include creating so-called pension megafunds designed to boost returns for British savers.
The Chancellor wants to consolidate some large pension funds, including the 86 local government schemes.
The megafunds will mirror schemes in Australia and Canada, where pension funds take advantage of size to invest in assets that have higher growth potential.
