The beginning of the new tax year sees Allfunds, a UK-based B2B WealthTech platform, list on the Euronext Amsterdam stock exchange. We’re not sure what the long-term effects of Brexit will be in financial services – and anyone who claims to have known in 2016 or even now is not to be believed. But the short-term effect has seen a migration of equity trades and listings from London to Amsterdam. This may change over a longer time frame. Let’s hope so.
Allfunds has built an ecosystem that covers the entire fund distribution value chain and investment cycle, including via Allfunds Connect, a full suite of SaaS-enabled digital, data and analytics tools.
As of 31 December, 2020, Allfunds had over €1.2 trillion of assets under administration, €370 million revenue, and €263 million adjusted Ebitda. The group has experienced a growth rate of 13% over the past three months.
The company has appointed BNP Paribas, Credit Suisse Securities, Citigroup Global Markets and Morgan Stanley Europe as joint bookrunner, for the offering, which consist of a private placement of 25% of the company’s shares held by LHC3, BNP Paribas and Credit Suisse.
Latest Loan Offer
The latest loan offer on site has an A-rating and an annual rate of interest of 7 per cent. The term of the loan is 24 months. The offer is currently 51 per cent filled.
Historical Performance And IFISA Process Guide
That figure is the result of over £20 million of loans facilitated on the site, as we bring individuals looking for a good return on capital together with carefully vetted small companies seeking funds for growth. Bear in mind that lenders’ capital is at risk. Read warnings on site before committing capital.
All loans on site are eligible to be held in a Money&Co. Innovative Finance Individual Savings Account (IFISA), up to the annual ISA limit of £20,000. Such loans offer lenders tax-free income. Our offering is an Innovative Finance ISA (IFISA) that can hold the peer-to-peer (P2P) business loans that Money&Co. facilitates. For the purposes of this article, the terms ISA and IFISA are interchangeable.
So here’s our guide to the process:
The ISA allowance for 2020/21 is unchanged from last tax year at £20,000, allowing a married couple to put £40,000 into a tax-free environment. Over three years, an investment of this scale in two Money&Co. Innovative Finance ISAs would generate £8,400 of income completely free of tax. We’re assuming a 7 per cent return, net of charges and free of tax here.
Once you have made your initial commitment, you might then consider diversifying – buying a spread of loans. To do this, you can go into the “loans for sale” market. All loans bought in this market also qualify for IFISA tax benefits.
Risk: Security, Access, Yield
Do consider not just the return, but the security and the ease of access to your investment. We write regularly about these three key factors. Here’s one of several earlier articles on security, access and yield.