Investors can now open an Innovative Finance ISA (IFISA) with Lendwise and earn up to 9% p.a.* in tax-free interest.
The IFISA was launched following a successful trial period in 2021. It is the first of its kind in the UK to fund postgraduate loans and other forms of education finance. As a lender, you will be able to diversify your investments and define your own risk appetite. Active lenders on Lendwise’s platform currently have returns ranging from 4% to 12%, and average returns of c.9%.
The wrapper will exempt individual investors from income tax on interest arising from loan investments of up to £20,000 each tax year, subject to other ISAs they may have. IFISA investors with Lendwise will also have access to its secondary marketplace. This enables lenders to sell part or all of their loan before it reaches maturity. Loan investments into the IFISA will fund the platform’s flexible, fixed-rate loans to postgraduate students and borrowers undertaking other professional qualifications.
Demand from postgraduate students has been rising sharply since the lockdown reduced opportunities to generate income from part-time work. The volume of loans we received in the first three quarters of 2021 surpassed the total number for 2020. Meanwhile, the withdrawal from retail space of other P2P lending platforms has also boosted interest in Lendwise from investors.
We have always considered an IFISA a natural evolution of the Lendwise platform and the offering to our lenders. But the recent changes to the market are also part of the reason why we decided to launch it.
P2P Education Finance
We are extremely proud to be the only peer-to-peer platform in the UK funding the education of ambitious individuals who have the merit and ability, but not all of the funds, to achieve enrolment. The option to achieve strong returns in a tax-efficient wrapper that offers exposure to education finance, specifically the funding of postgraduate students, is a truly unique offering for investors.
There is also peace of mind in knowing that we analyse our borrower’s future earnings potential and other outcomes when assessing their creditworthiness, not just their credit score. Our borrowers also have proven a greater ability to repay their loans due to their enhanced skills and career prospects.
For investors, getting this type of differentiated exposure in an IFISA which delivers above-market yields, has never been as easy as it is with a Lendwise IFISA.
* As with all peer-to-peer loans, our products place capital at risk. You may not get back the full amount you lend and/or the interest you expect. Loans are made to individuals over a period of up to 10 years and as such, loans can be illiquid. The tax treatment of interest and reliefs on defaults may be subject to change and tax treatments will depend on y our individual circumstances. Any reference made to past performance or forecasted performance of interest rates is not a reliable indicator of future performance. Lendwise Ltd, trading as Lendwise, does not provide investment or tax advice, and information on this website should not be construed as such. You should consider seeking independent tax and financial advice before making a peer-to-peer loan.
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