Security of payment transactions is not the sexiest topic, even in the dry world of financial services. Nevertheless, transaction security is an absolute cornerstone of financial stability. We blogged recently on this very topic – will identity become the new currency?
Meanwhile, our friends at FinExtra report developments in international payment systems:
The emergence of new players such as Libra has thrown into sharp relief how slow, expensive and unreliable traditional cross-border payments can be, says a Bank for International Settlement committee report which also offers some ideas for improving the situation.
BIS’s Committee on Payments and Market Infrastructures (CPMI) has put together the report in response to Saudi Arabia making the improvement of cross-border payments a priority of its G20 presidency.
The report offers 19 building blocks for resolving the longstanding frictions and challenges in cross-border payments, which have been left behind by improvements in domestic payments and could soon be disrupted by new entrants such as Libra.
Historical Performance And IFISA Process Guide
That figure is the result of over £21 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.