There’s a strong body of opinion among economic commentators that the UK is embarking upon a difficult period. High inflation, a struggling small-and medium-sized business sector and a woeful lack of leadership from government betoken tough times ahead.
Money&Co., thanks to its policy of cautious lending and pursuing asset-backed and other specialist niche deals, is to a large degree insulated from the worst of the general malaise. Our company is now showing consistent profit, these difficult times notwithstanding.
The management tactics that have brought about this situation are well highlighted by our friends at P2P Finance News in their survey of the most powerful people in our sector. Below is a mini-profile of our CEO, Nicola Horlick.
The ‘City superwoman’ has led a prestigious career, from private equity and fund management to launching P2P lending platform Money&Co in 2013. Undeterred by the pandemic, Horlick had diversified into different niches during the Covid crisis, including litigation finance, music loans, TV and film rights. Horlick has previously highlighted how the platform was already lending with caution prior to the crisis due to Brexit-induced economic concerns.
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.