Last week, BetaKit wrote about the decision by Toronto-based FinTech startup Lending Loop to voluntarily suspended new loan requests on its platform. The company, which describes itself as Canada’s first and only peer-to-peer lending marketplace for small and medium-sized businesses, had also begun talks with unnamed securities regulatory authorities.

The company had previously told the Financial Post that it was following a U.S.-style model of peer-to-peer lending, allowing Canadians with $50 to pool money into larger loans for small businesses. Multiple sources had confirmed to BetaKit at that time that Lending Loop’s flaunting of Ontario Securities Act regulations and warnings from the Ontario Securities Commission had led to the kerfuffle.

This week, Lending Loop CEO Cato Pastoll was on BNN’s The Disruptors, defending his company’s business model in an interview with co-host Bruce Croxon (which can be viewed below).

“What I can definitely say is that for well over a year we’ve been working with one of the top law firms in Canada to make sure we structured ourselves in a way that we believed would work in the Canadian regulatory landscape,” Pastoll said.

“That being said, we’re not Uber, we’re not a company that’s just going to go out there and operate on a whim. So we decided to voluntarily cease operations, at least for the time being, continuing to fund loans through our own sources of capital. But really with the intention of having a good faith discussion with the appropriate regulatory bodies.”

When Croxon pushed back on the reasons behind company’s voluntary decision to halt new loan requests, Pastoll answered, “I think we had a level of push-back from the industry in terms of the open manner in which we were operating.”

Despite where Lending Loop currently stands with Canadian regulations, Pastoll was adamant that the company’s model was following a stable and respectable trend internationally.

“I think if you look at international peer-to-peer lending platforms, the differentiation between a complete buyer-beware investment and what these are, is that this is a very stable industry,” Pastoll said. “In fact, in some countries, it’s even being compared to deposit accounts in terms of its stability. So if you look at the US, or the UK, we’re looking at annual returns ranging from 6 to 9%.”

Pastoll also referred to a recent Monk report that stated Canadian peer-to-peer lending is 11 years behind that of the UK.

“Fundamentally, the key pillars of the financial ecosystem here are protecting some of the incumbents and I think it’s been very difficult for new platforms to come out and replicate those business models in the Canadian landscape.”

Following the interview, Croxon discussed Lending Loop’s stance with co-host Amber Kanwar (video below). “I came away thinking it would be good if the [Canadian] regulation went away,” Croxon said. “But the fact remains that it is not that way, and we were right to call them out on it.”