SECURED peer-to-peer business loans platform Folk2Folk is planning to launch its Innovative Finance ISA (IFISA) in the coming weeks and will lower its minimum investment threshold for the product.
The P2P lender received Financial Conduct Authority authorisation at the end of last year. A spokesperson told Peer-to-Peer Finance News that it received ISA manager status from HMRC earlier this month and is now only weeks away from launching the tax-free wrapper.
Peer-to-Peer Finance News reported back in October that Folk2Folk was considering lowering its investment threshold to accommodate the ISA allowance limit. The platform currently imposes a minimum investment of £25,000 for lenders, but the spokesperson confirmed that this would be lowered to £15,000, to allow for the annual ISA allowance limit of £15,240. It will be increased to £20,000 in the next tax year when the ISA allowance is increased.
“The IFISA will first be offered to existing investors and there will be a waiting list for others as loans fill up,” the spokesman said.
“The launch will be weeks rather than months away. We have a loan pipeline of £20m to £30m over the next few months so we are confident we can meet demand.
“It is likely that each investor’s allowance would go towards one loan.”
The typical loan size on the platform is £250,000, the spokesman said.
Once the ISA is launched, the spokesman said, Folk2Folk will look to launch a self-invested personal (SIPP) pension product and is working on this with SIPPClub. It comes after Crowdstacker yesterday said it was planning its own low-cost SIPP.
The P2P platform is also planning to grow from three branches to 10 by the end of this year.
Read more: Folk2Folk eyes growth overseas
For more on the IFISA, look out for our feature in the upcoming print edition of Peer-to-Peer Finance News, which comes out at the beginning of February.