April IFISA Roundup
2017’s IFISA narrative has been pivotal, dynamic and has seen much traffic in the way of new services and products. In January, Lending Works was the first of the major peer-to-peer lending market players to launch its own IFISA product. Furthermore, several peer-to-peer platforms have themselves been obtaining approval by the necessary regulatory bodies, while many of platforms that have already released their own ISAs, have seen encouraging levels of uptake.
We look specifically at the past month, which has been as interesting as it has active, attributed in part, no doubt, to the past month containing the end of the 2015/16 tax year, and the start of the 2016/17 tax year.
New Tax Year
The subjects of taxes and ISAs obviously go hand in hand, particularly as the popularity of ISAs rather heavily depends on their tax-free status. It is therefore unsurprising that the new tax year has been an interesting time for those promoting the new ISA:
- Customers looking for new ways of investing their money in this new year could be looking at IFISAs to either transfer their existing ISA savings into, and/or choose an IFISA outright as their ISA option for the year ahead
- The government-set limit that investors can put into their ISAs has risen significantly, from £15,240 to £20,000 – this means that investors could see considerably more tax-free returns
- Many firms were waiting tentatively for their FCA and HMRC approval – especially since announcing their new IFISA products in time for the new tax year, in a bid to capitalise on the surge in interest new IFISA products. Some did, and some did not, launch in time for the new tax year
The past month has seen a fair few IFISA providers launch their exciting new avenues of tax free investments, including:
- FundingSecure launched an IFISA on its peer-to-peer pawnbroking platform. Investors can lend to borrowers, with an asset used as security. Fine art, jewellery, property and classic cars, they’re all fair game
- Crowd for Angels launched its IFISA at the beginning of March. Then, at the end of March, it offered a new two per cent cash back bonus to investors wanting to get tax-free income from its crowd bonds
- Another crowd bond entry, this time from Downing in March. Its product allows investor the chance of tax free returns from investment into UK companies via bonds secured on their assets
- Basset & Gold’s ISA, covering fixed income bonds, was unveiled
- UK Bond Network launched its IFISA at the end of March. It encouraged interested parties with a 1 per cent cash back sweetener for investing in an ISA through its peer-to-peer bond auction platform
- HNW Lending’s new ISAs are secured by borrower assets
- Property Crowd’s ISA is open to lenders interested in investing in real estate
- CapitalRise’s IFISA seeks to raise funding for its property projects
Awareness of the IFISA grows amongst consumers, and now that the ceiling for the investment amount has been pushed up, these investors have the added incentive to find the IFISA product that could be right for them. Whilst the Spring budget gave no added impetus for the peer-to-peer ISA cause, the tax-free earnings on offer are incentive enough. Regulatory approvals continue to be pushed through, and already approved platforms are priming to launch their own ISAs. The coming months, and even just month singular, will see similar, if not more commercial announcements in the IFISA world.