RATESETTER is set to launch its Innovative Finance ISA (IFISA) on Thursday to existing customers, meaning that the three largest industry players will now have their products on the market.
The peer-to-peer platform said on Wednesday that the tax wrapper will be opened up to new customers on 1 March and to inward transfers from other ISAs in April.
“RateSetter’s purpose is to give people the opportunity to earn more on their money,” said chief executive and founder Rhydian Lewis (pictured). “Our ISA makes that opportunity even more compelling because investing is now tax-free.
“Cash ISA savers are frustrated with low interest rates, while inflation is always nibbling away at their money. Stocks and shares ISA investors have enjoyed good returns recently but may be nervous of market falls, as demonstrated in the last few days.
“Lending is a third asset class in the middle, offering the potential for higher returns than cash without the volatility of shares.
“With RateSetter’s excellent track record and our focus on the retail investor, we believe our ISA will become an attractive home for people looking to put their money to work.”
RateSetter began emailing existing customers last week to get them ready for its IFISA launch this month, but this is the first time that an exact date has been confirmed. It said that the IFISA would be made available to investors in the order they opened accounts.
RateSetter’s IFISA will offer annual returns ranging between three and six per cent, depending on the level of access. It is a flexible ISA, meaning that investors can withdraw and replace money within the same tax year without losing their tax-free allowance.