Landbay launches Innovative Finance ISA

Both new and existing investors on the Landbay platform can now invest up to the full ISA annual allowance of £15,240 in this tax year (2016/17), rising to £20,000 at the start of the new tax year in April. The product launches with a minimum investment of £5,000, at a rate of 3.75%.

The move comes after the lender secured the various permissions required to enter this market. In December 2016, the Financial Conduct Authority (FCA) granted Landbay full authorisation for peer-to-peer lending and in January this year, HMRC granted it ISA Manager Status.

The IFISA was first announced in March 2015, and it became available April 2016. However, only a few platforms have so far been granted ISA Manager Status.

John Goodall (pictured), chief executive officer at Landbay, said: “When the Chancellor first announced the IFISA would launch in April 2016, it was hailed as a victory for savers and investors alike. It’s taken a little longer than expected for products to pass regulatory scrutiny and reach the market, but we’re proud to be one of the first platforms to offer investors the benefits of the tax wrapper, and in time for the end of the tax year.”

He added: “At a time when investors are facing record low interest rates, and the prospect of rising inflation, our IFISA gives people the opportunity to earn a 3.75% return in a tax efficient manner, by lending to one of the UK’s best performing asset classes: buy to let. This is a fantastic opportunity for investors both this tax year and next, when the ISA allowance rises to £20,000.”

Folk2Folk, another peer-to-peer lender that hopes to offer an IFISA in the coming months, last week announced it had joined the Peer-to-Peer Finance Association.

Folk2Folk gained full authorisation from the FCA in December 2016 and at the time the lender’s chief executive officer, Jane Dumeresque commented: “This decision is significant as it makes us eligible to offer our IFISA in due course.”