Because it tends to be one of the more important questions P2P investors ask, it is important to expand on the regulations imposed on peer-to-peer lending. On April 1st 2014 the FCA stepped in and decided to regulate the industry. For customers of P2P lending it has provided some comfort knowing that a legal authority is monitoring and authorizing the lending platforms. P2P lending platforms are held accountable and are forced to constantly refine and improve their processes.
Another UK Government addition to peer-to-peer lending comes in the form of the Innovative Finance ISA, or IFISA, or ‘peer-to-peer ISA’ as some are calling it. This tax-efficient wrapper allows you to hold your peer-to-peer investments (multiple), for your chosen (single) P2P platform, in an account where you can earn tax-free interest on your yearly ISA allowance of £15,240. For more information on the IFISA, click the link above.
The little, or big, unknowns depending on your experience as an investor, are the truly risky parts when it comes to investing, in any asset class. Within this guide the main risks of peer-to-peer lending are outlined. It is your duty to assess how much risk you are willing to take in order to receive high rates in the region 5% and upwards. Each peer-to-peer lender carries different risk weighting, and we are here to help.
So, visit our comparison table, browse the platforms and products, review the risks and the mitigating procedures imposed by each P2P lender, add some innovation to your investment portfolio, or simply boost your savings, and start earning: