Lending Works launches new ISA
Lending Works is proud to announce that we have officially launched our new Individual Savings Account (ISA).
The new peer-to-peer lending ISA - which is better known as the Innovative Finance ISA or IFISA - is a new category of ISA set up exclusively, at this stage, for P2P lending. The IFISA can only be offered by platforms who have attained both full authorisation from the Financial Conduct Authority (FCA), and subsequently ISA Manager approval from HMRC.
Lending Works received confirmation of both permissions in late 2016, and the company has now become the first member of the industry-body Peer-to-Peer Finance Association (P2PFA) to launch the new ISA product.
“We are delighted to announce the launch of the Lending Works ISA, giving investors the opportunity to earn higher rates of interest by using their ISA allowance to invest in peer-to-peer loans," commented our CEO Nick in the wake of the big day. "This launch comes in response to unprecedented demand by investors, who are looking to new asset classes for income growth, at a time when other investments and bank savings accounts are often delivering mediocre returns, if at all.
“Our lenders tell us that they are crying out for yield generating products, such as our ISA. As the first major UK peer-to-peer platform to launch an IFISA, we are focused on developing a world-class customer experience and look forward to seeing our investors reap the benefits.”
Significant investor demand expected
Consumers will be able to subscribe up to the ISA allowance of £15,240 for the current financial year with Lending Works, although they have the option of splitting this across all three ISA types – cash, stocks & shares and IFISA. This allowance is set to increase to £20,000 in 2017/18. In addition, there will be no cap imposed on the transfer of funds accumulated over previous tax years within existing ISAs into an IFISA, meaning the benefits are likely to be substantial.
Lending Works is anticipating a significant influx of new investors on the back of the launch, with a recent survey of existing investors confirming that 88 per cent plan to open an IFISA, with roughly a third (31 per cent) expecting to invest between £10,000 and £15,240 of their annual ISA allowance to this wrapper before the tax year is complete.
“Given the extraordinary level of interest from both existing and prospective customers in the build-up to the launch of our ISA, we expect to see a large spike in the volume of funds coming to our platform over the next couple of months as savvy investors look to make the most of this year’s ISA season," Nick added.
“But what excites us most is the prospect of delivering sustained, long-term benefits to our customers via the Lending Works ISA for many, many years to come.”
Should you wish to further educate yourself on all things IFISA, please do consult our Ultimate Guide.