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Peer2Peer Finance News | May 29, 2017

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Proplend joins IFISA pipeline after getting HMRC stamp of approval

Proplend joins IFISA pipeline after getting HMRC stamp of approval
Anna Brunetti

COMMERCIAL property peer-to-peer platform Proplend confirmed on Wednesday it received ISA manager status by HMRC, just three weeks after gaining full authorisation from the Financial Conduct Authority (FCA).

The stamp of approval means the firm will now be able to offer its own Innovative Finance ISA (IFISA), which it said it will launch by the end of April.

Due to the level of demand it has already received, it has invited investors to register their interest by signing up to regular IFISA online updates.

“Since we announced news of our full FCA authorisation on 1 March, we’ve received a flood of enquiries about the IFISA,” said the firm’s chief executive Brian Bartaby.

Read more: Property Crowd unveils IFISA

“We are now working hard to make the Proplend IFISA available by the end of April and to give peer to peer investors the credible alternative of investing on one of the safest P2P lending platforms in the UK.”

Bartaby emphasised that investors should understand that IFISAs are not protected by the Financial Services Compensation Scheme, so their capital is at risk.

“But with that risk comes the potential of significantly higher returns,” he added. “Proplend looks to minimise this risk by securing all loans with a first legal charge, ensuring that they are first in line to be repaid.”

The firm currently offers investors returns of between five and 12 per cent per year, with three risk tranches based on different loans-to-value (LTV) ratios.

The lowest risk is tranche A at zero to 50 per cent LTV, tranche B is 51 to 65 per cent LTV and tranche C is 66 to 75 per cent LTV.

At the time of the FCA announcement, Bartaby told Peer-to-Peer Finance News that the firm was considering arranging a low-risk tranche A IFISA to cater for the “more passive investor.”

Read more: CapitalRise unveils IFISA ahead of new property deal