PEER-TO-PEER investor BondMason is backing the pension market as a bigger area for its growth than Innovative Finance ISAs (IFISA).
The platform is working with the Financial Conduct Authority to get IFISA approval but says its main focus is actually on self-invested personal pensions (SIPPs) and small self-administered schemes (SSAS).
Speaking to Peer-to-Peer Finance News, Stephen Findlay, chief executive of BondMason, said the firm is working with a handful of pension administrators.
“Our key priority at the moment is around SIPPS and SSAS products as we feel the product fits well with what pension administrators want,” he said.
“We provide the administrator with a dashboard so they can see who the lenders are and the loans and decide if they want to take them.”
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It comes as Peer to Peer Finance News revealed that several P2P platforms are working on their own standalone SIPPS due to the mainstream market making it tougher for investors to include their loans.
Findlay also expressed concern that investors may confuse ISA approval with government backing.
“My fear with the IFISA is that people may mistakenly see them as government backed due to the tax-free status,” he said.
“That then creates the risk that someone could lose their savings thinking they are in a totally secure scheme. Investors need to do more due diligence than just relying on a platform having IFISA status.”
BondMason aims to get clients a seven per cent return by selecting P2P loans across approved platforms on their behalf. It does not require regulation for its current product but will need ISA manager status from HMRC to provide an IFISA.