The fallout continues from the failure of Peer-to-peer (P2P) lending platform, Lendy. Lendy was regulated by the FCA, and there are vociferous calls for compensation for investors. The City grandee Lord Myners is at the fore of the this movement,
The Times reports on this (subscription required), as does P2P Finance News.
FORMER City minister Lord Myners is keeping the pressure on the Financial Conduct Authority over its decision to authorise now-collapsed peer-to-peer lending platform Lendy.
A series of written parliamentary questions show Lord Myners is seeking answers on whether better regulation is needed and the creditor status of Lendy investors.
His latest questions ask the government if it has identified any features in common in the cases of the collapse of London Capital and Finance, Lendy and Collateral that require a change in regulation, law or process.
Another asks whether the FCA was informed, or aware that investors via Lendy were creditors to a P2P platform; and whether such information could have been determined from the accounts of Lendy.
There has not been a response yet.
Loan Latest And IFISA Process Guide
That figure is the result of over £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.
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 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.
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.