The new year will see a step change on the acceptance of crypto and digital currencies. Cryptos are decentralised digital currencies, controlled by an independent algorithm. Digital currencies are often centrally administered money in a cute digital format.
In the UK, we’ll see retail outlets such as the chemist, Boots, take digital payment. That’s just one of many high-street developments ahead.
Europe’s top securities regulator is seeking submissions on the need for amending the regulatory technical standards (RTS) on reporting and transparency requirements in order to accommodate growing use of blockchain technology in financial markets.
The call for evidence from the European Securities and Markets Authority (Esma) asks for input from stakeholders on the use of DLT for trading and settlement.
The agency is consulting on a pilot regime for market infrastructures based on DLT, examining transaction reporting exemptions and ways in which regulators can gain access to information on transactions, financial instruments’ reference data and transparency data.
States the regulator: “The aim is to ensure more efficient, secure, and cost-effective management of the data stored on DLTs while preserving its quality, usability and comparability.”
Stakeholders are invited to provide comments by 4 March 2022. Esma says that if amendments to the rules are required it will draw up proposals for submission to the European Commission for adoption.
Historical Performance And IFISA Process Guide
That figure is the result of over £24 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 2020/21 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.