Samir Desai, CEO and co-founder of Funding Circle, said: “This news would be a huge win for British investors up and down the country, and represent a seminal moment for our industry. The proposed inclusion of peer-to-peer lending in ISAs would ensure British people earn inflation-beating, tax-free returns whilst helping support the country’s economic recovery. We are looking forward to contributing to any consultation period over the coming months.
Today’s news will open up peer-to-peer lending to a new audience. Over the last three years more than 25,000 people have lent £180m to 3,000 businesses through Funding Circle. We’re excited to think people could be able to use their ISA entitlements to benefit further from our unrivalled track record in the space.”
Daniel Rajkumar, Managing Director of rebuildingsociety.com, commented: “This marks a seismic shift in the savings industry and would be an excellent move to encourage a new wave of P2P investors who can help create a thriving SME sector in the UK. As a result, both borrowers and investors benefit.
Given the government’s move to focus attention on business lending, this complementary strategy represents long term support for the industry. With this announcement and impending regulation next year, we anticipate participation levels to soar through increased media coverage and independent financial advisers recommending the product.”
Rhydian Lewis, CEO of ratesetter.com, said: “Over the last few years RateSetter and others in the space, have proved themselves to be safe, transparent, and highly competitive vehicles for Savers. It is absolutely right that we should receive recognition of this from Government. ISAs will be a game changer for our industry.”
According to data from Funding Circle, 41% of investors said they would invest more in peer-to-peer lending if it was included within ISAs. One in ten people said they would transfer their existing stocks and shares into peer-to-peer lending.
Additionally, TISA (Tax Incentivised Savings Association) estimates that more than £50 billion is invested in ISAs every year. If just 3% of this money was channeled through marketplaces such as Funding Circle it would create more than £1.5 billion of new lending to businesses annually leading to approximately 75,000 new jobs.
Don’t miss the Chancellor’s Autumn Statement from 10.45am on BBC News today!