As part of the UK government’s budget policy, Chancellor of the Exchequer George Osborne affirmed that soon (April 2016) ISAs will allow for peer to peer lending assets to be part of a savers portfolio. Osborne also stated the government will consider allowing equity crowdfunded investments to be included in ISAs as well.
As part of the decision making process, policy makers have published a Consultation Paper (embedded below) to aid in crafting appropriate rules and processes.
The notice states:
This consultation seeks views on whether to extend the list of ISA qualifying investments to debt securities and equity offered via crowdfunding platforms. The government proposes to assess the case for extending ISAs in this way against a number of core principles that are set out in the consultation document.
The government would particularly welcome views from any individual, business or representative body with an interest in investment based crowdfunding and ISAs. The views expressed will inform the government’s decision over whether to proceed with this change to the list of ISA qualifying investments.
The policy statement views equity crowdfunding as a positive economic catalyst in matching investors to firms in need of capital;
“Crowdfunding is an important source of alternative finance for small and mid-sized companies and a driver of economic growth. For instance, since securing funding from equity crowdfunding platforms, 70% of businesses have increased turnover and 60% have increased employment.”
By adding crowdfunded securities to ISAs, the government will be moving forward with its objective of promoting choice for savers, encouraging growth in the crowdfunding sector while improving competition in the banking sector.
This formal consultation sets out core principles against which the government proposes to assess the case for making crowdfunded debt and equity eligible for ISAs.
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