Under article 36H of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, SI 2001/544 (RAO), operating an electronic system in relation to lending in the UK, by way of business, is a regulated activity. This Practice Note examines the scope of that regulated activity, including the main elements of operating an electronic system in relation to lending, the rules applicable to firms authorised to carry on this activity, and the key exclusions from the regulated activity. Regulated activities—general Section 19(1) of the Financial Services and Markets Act 2000 (FSMA 2000) imposes a general prohibition on carrying on regulated activities in the UK unless the person is either authorised or exempt. In accordance with FSMA 2000, s 22, for an activity to constitute a regulated activity, it must be carried on 'by way of business'. Under the Financial Conduct Authority’s (FCA) Perimeter Guidance Manual (PERG) (PERG 2.3.3 G), whether or not an activity is carried on by way of business depends on factors such as its scale, degree of continuity, the