Our friends at P2PFN report some important but unsurprising news. The alternative finance sector, of which peer-to-peer (P2P) lending is an important part, is growing in importance and size. As it does so, awareness grows of companies such as Money&Co., which brings carefully vetted businesses together with lenders looking for excellent returns on capital. Financial technology (FinTech) is the future – but, for many, not the present.
More than 50 per cent of people working in the financial services sector are unaware of global fintech bridges, a new study has revealed.
There are 46 fintech bridges in place across the world, encouraging collaboration and cooperation between governments, regulators and the private sector in different countries.
In the UK, the Treasury’s fintech sector strategy, released in March 2018, highlighted how fintech bridges will “reduce barriers to market entry and link UK-based fintechs up with opportunities for international investment.”
But the survey from Fintech Circle found that just one in three people working within the sector understand what fintech bridges are designed to do, with over 50 per cent of respondents knowing nothing about the initiative.
Three quarters of 219 financial services professionals surveyed said they would like government support to help them understand financial regulation, while half said practical help on entering the fintech market should be a key priority of governments and financial regulators worldwide.”
New loans are due on site soon. See latest, property-backed P2P loan – fixed yield of 8 per cent, five-year term, and currently almost three quarters filled.
All loans on site are eligible to be held in a Money&Co. Innovative Finance Individual Savings Account (ISA), up to the annual ISA limit of £20,000. Such loans offer lenders tax-free income.
A Process Guide To Innovative Finance ISA Investment
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.