ENVIRONMENTALLY conscious investors have the chance to invest in a new ISA-eligible bond, as peer-to-peer investment manager Goji and alternative investment firm Prestige-Prime Group have joined up to launch a renewables lending bond.
The bond, unveiled on Wednesday, enables financial advisers and wealth to invest in more than 40 renewables projects, including wind, solar and biomass power. It will be used to finance projects that are originated by Prestige’s loan team, which has been working in renewables financing for 15 years.
The new offering will provide annual returns of 5.5 per cent for a three-year investment and 6.5 per cent for a five-year investment. Prestige is guaranteeing the first 20 per cent of first losses.
The investment is eligible to be held within an Innovative Finance ISA or a SIPP.
“Renewables infrastructure and socially responsible investing continue to rise in prominence,” said Jake Wombwell-Povey, chief executive officer of Goji.
“Goji’s renewables lending bond offers financial advisers and their clients the opportunity to diversify their portfolios and earn attractive returns on heavily secured projects that are managed by a major player in the renewables financing market – all without the exposure to market volatility that comes with traditional fixed income.”
Over the last decade, UK renewables projects have struggled to obtain financing from high street banks following the financial crisis, creating a gap for private investment and alternative lenders to fund these projects.
“The availability of dedicated credit for renewable energy sources is already having a positive impact on the UK’s environment and energy security,” said Craig Reeves, founder of Prestige. “But the UK still lags behind Europe in the establishment and financing of renewable energy projects, so there is plenty of room for expansion.
“Investing through the renewables bond offers investors an attractive opportunity to bridge this gap whilst providing attractive, steady, socially-responsible returns that back UK businesses.”