Folk2Folk to lower investment threshold for IFISAs
FOLK2FOLK is planning on lowering its £25,000 minimum investment threshold once it can offer the Innovative Finance ISAs (IFISAs), Peer-to-Peer Finance News has learnt.
The peer-to-peer business lender, like many of its rivals, is still awaiting full authorisation from the Financial Conduct Authority so that it can apply to HMRC for ISA manager status. Then it can offer the tax-free wrapper around P2P investments – but the current ISA limit is £15,240 per year.
“We’ll make an exception to our minimum investment threshold for the IFISAs,” chief executive Jane Dumeresque said on the sidelines of the LendIt conference in London on Tuesday.
“We sent a note round to our customers and 20 per cent said they’d like to invest in them. It’s clearly a very attractive proposition.”
Dumeresque said that she was “feeling very optimistic” about FCA approval and that the Cornwall-headquartered business had reached the “final hurdle” in complying with the regulatory process.
Folk2Folk was set up in 2013 by the owners of law firm Parnalls of Launceston. It connects high-net-worth individuals with business borrowers and the loans are secured, usually against property.
Investors can choose who they lend to, giving them the option to invest in local businesses. Returns range between 5.5 per cent and 6.5 per cent.
The company has opened a number of high-street branches in select regions of the country in order to attract borrowers and lenders. On Monday it announced it will be opening a new office in Gloucestershire on 1 November after establishing a local demand.
