We’re pleased to see an attempt to create what the UK government’s trade department hopes will be the digital “go-to destination for people working in the industry to get access to funding, knowledge, and talent”. Our friends at P2P Finance News record the launch of this digital hub.
We can only hope this promotes clarity and transparency in reporting, especially in our own peer-to-peer (P2P) space. We’ll be blogging on this and other topics shortly.
The FinTech Alliance was formed through a partnership with the Department for International Trade (DIT), as a way to promote fintech growth across the country, and to build new fintech bridges.
More than 500 companies and individuals from across the UK have already joined, including property lender Landbay, and lending marketplace Funding Xchange.
Members can use the platform to access and share insights and news from the fintech sector, and it can also be used to connect with investors, receive updates on the latest policy and regulatory changes, and find new talent.
The platform intends to open up to international opportunities soon, with the aim of attracting global investment into UK firms and strengthening the UK’s reputation as a global fintech leader.
Loans – Latest News
The latest loan from property-backed Seascape is now available. This A-rated tranche yields 8 per cent gross and has a five-year duration.
A Process Guide To Innovative Finance ISA Investment
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 £17 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. The annualised bad rate on Money&Co. loans in five years of trading is under 0.04 per cent.
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 2018/19 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.