LendingCrowd: Two thirds of IFISA inflows come from cash ISAs
Scotland-based peer-to-peer platform LendingCrowd has revealed that 66 per cent of its IFISA transfers have come from cash ISA accounts.
Since the LendingCrowd IFISA was launched in February 2017, millions of pounds have been invested in the tax-free investment product. However, cash ISAs were by far the most popular source of ISA transfers. Stocks and shares ISAs accounted for just 18 per cent of transfers into the LendingCrowd IFISA, while transfers from other IFISA accounts made up the remaining 16 per cent.
Stuart Lunn, founder and chief executive of LendingCrowd, said that low cash savings rates and rising inflation is likely to be behind this trend.
“It’s clear that cash ISAs are falling out of favour among savers who are tired of seeing the value of their money eroded by inflation,” said Lunn.
“Our IFISA is proving extremely popular, and we expect demand to continue rising rapidly as more people realise their money could be working much harder for them.”
LendingCrowd currently offers two IFISA accounts: a Growth ISA which targets returns of up to six per cent per year by automatically pooling investor money into a portfolio of business loans; and a Self Select ISA, which allows investors to hand-pick the businesses they want to lend to, at lending rates of between 5.95 per cent and 14.25 per cent.
The platform is also offering up to three per cent in cashback to new and existing investors who invest at least £2,500 before 30 April 2019. Furthermore, anyone transferring an ISA worth £5,000 or more will receive an extra £50 cash bonus.
Updated: Friday, March 15th, 2019