The peer-to-peer business lender, which was founded by City 'superwoman' Nicola Horlick, is planning to discontinue single-loan offerings in favour of a "portfolio approach".
"We are sticking with our successful strategy on loan origination," said Horlick. "We originate primarily property-backed loans where our lenders take a first charge against the underlying property – typically the loan will be no more than two thirds of the market value of the underlying property asset. We're also willing to facilitate loans where the security is a business-critical asset (eg. a printing press for a printing company).
"To offer extra security, we're placing more emphasis on diversification. We'll be looking to market a portfolio of property- and asset-backed loans to lenders and Innovative Finance ISA (IFISA) investors."
We're pleased to announce the recent launch of our latest property-backed loan. North-East Property Investment has a fixed-rate yield of eight per cent over three years. It's 46 per cent subscribed at the time of writing.As ever, we've made our best efforts in due diligence and credit analysis before awarding this loan an A rating. However, we cannot warrant that the representations of the borrower are true – though clearly we believe them to be so. We offer an excerpt from those representations – available to registered lenders – below.
Please remember there is always an element of risk, and capital loaned is at risk. See risk warnings at the foot of this article, on our Home page and in FAQs on site.
Another 8% Yield Loan - 92% Subscribed
The latest property-backed £250,000 loan from Seascape is now more than 92 per cent subscribed. This A-rated tranche yields 8 per cent gross, at a fixed rate for five years. As is the case with earlier tranches of credit, we have used our best efforts to ensure the truth of the assertions made, but cannot warrant their absolute accuracy. Fuller detail is available to logged-in members.
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 almost £15 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:
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 2019/20 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.