The peer to peer lending industry sees the light at the end of the tunnel as the UK government nears the day when retirement funds, in the form of Individual Savings Acccounts (ISAs) will be able to invest in P2P loans. Last week the UK government announced a new consultation paper on the subject and is currently soliciting feedback from industry participants and anyone else that wants to jump into the mix. Many industry followers see the inclusion of P2P assets as a significant opportunity for savers who have struggled during the low interest rate environment over the past years. Simultaneously P2P platforms expect a dramatic increase in capital thus fueling industry growth. Today total volume to date is approximately £2 billion but ISA inclusion will push that growth further.
Leading UK platform Zopa recently commented on the consolation paper and expected policy change;
“Peer-to-peer ISAs will be a game changer for millions of hard working Brits, and a major shakeup for the UK banking sector. The government consultation is a positive step forward to help define how P2P lending is included and we would welcome a third ISA for P2P. Whatever the outcome, we cannot wait to be able to offer this fantastic product to our existing and future members.” said Zopa CEO and founder Giles Andrew.
Zopa has been advocating for the inclusion – as have been many other P2P platforms. The announcement was made earlier in 2014 by Chancellor of the Exchequer George Osborne of this shift – with the consultation being the next step in the process. A “third ISA” to hold may be the final approach to managing the process with P2P platforms acting as “ISA managers”.
Zopa has facilitated over £648 million in loans since the platform launched.