Irresistible Crypto Force To Best Immovable Regulatory Object

Irresistible forces and immovable objects have a fair bit of history. Inevitably, the irresistible force ends up the winner.

In FinTech, cryptos are the coming thing. And nothing, it seems, can stop them. The UK’s top financial watchdog, the Financial Conduct Authority (FCA), is reduced to little more than whining in this report from our friends at Finextra. The crypto exchange Binance has been allowed some latitude that will serve to accelerate the popularity of the digital currencies, and the FCA clearly doesn’t like it – and evidently hates its own lack of power. Another victory to the irresistible force…

The Financial Conduct Authority has expressed concern about a deal to give crytpo exchange Binance access to the the UK’s Faster Payment Service, but says it has “limited powers” to object.

Last year, Binance lost access to Faster Payments after the FCA ordered it to stop regulated activities in the UK.

However, the crypto giant has now inked a deal with US-listed Paysafe to restore access, meaning that its users can deposit sterling via the system.

The FCA has told the Financial Times that its concerns about Binance remain but that it has “limited powers to object to arrangements of this kind”.

Adds the regulator: “Paysafe is aware of our concerns and is subject to close ongoing supervision consistent with our approach for firms of its size.”

Firms based outside the UK can generally serve Brits without FCA oversight, says the FT.

Binance has gotten into hot water with regulators across the world concerned about its money laundering controls, prompting a vow from the firm to centralise its business structure to address concerns about a lack of systemic transparency.

Historical Performance And IFISA Process Guide

  • Money&Co. lenders have achieved an average return of more than 8 per cent gross (before we deduct our one per cent fee). 

That figure is the result of over £24 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.

  • Money&Co. has been lending for over 5 years and has only had two bad debts so far, representing a bad debt rate of 0.03 per cent per annum.

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:

  • Step 1: Register as a lender. Go to the login page, and go through the process that the law requires us to effect. This means we have to do basic checks on you to comply with money-laundering and other security requirements.
  • Step 2: Put money into your account. This is best done by electronic transfer. We can also process paper cheques drawn in favour of Denmark Square Limited, the parent company of Money&Co.
  • Step 3: Buy loans in the loan market. Once you’ve put cash in your account it will sit there – and it won’t earn interest until you’ve bought a piece of a loan. It’s this final step that requires lenders and IFISA investors to be pro-active. Just choose some loans – all loans on the Money&Co. site can be held in an IFISA – and your money will start earning tax-free interest.

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.



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Disclaimer: Money&Co.™ is the trading name of Denmark Square Limited, Company Number 08561817, registered in England & Wales, authorised and regulated by the Financial Conduct Authority (FCA). The company is identified on the Financial Services Register under Reference Number 727325. The registered office is 58 Glentham Road, Barnes, London, SW13 9JJ where the register of Directors may be inspected. Denmark Square Limited (ISA manager reference number Z1932) manages the Money&Co. Innovative Finance ISA.