UK-based peer-to-peer lender RateSetter recently celebrated RateSetter Innovative Finance ISA’s second birthday. The online lender launched the ISA in February 2018 and claims it has become the UK’s most popular Innovative Finance ISA. As previously reported, RateSetter described the ISA:
“The Innovative Finance ISA (IF ISA) is a new category of ISA, that sits somewhere between the traditional Cash ISA and Stocks & Shares ISA. It makes it possible to invest through peer-to-peer platforms such as RateSetter, tax-free. You can use your full £20,000 ISA allowance in our Innovative Finance ISA. Alternatively, you can split your investment between each type of ISA providing you stay within the overall £20,000 limit.”
RateSetter now claims that the Innovative Finance ISA is the newest category of ISA, and sits between the traditional Cash ISA and Stocks & Shares ISA and makes it possible to invest through peer-to-peer platforms, tax-free. Last summer, RateSetter ISA attracted more than £250 million in subscriptions, which also includes £50 million of inflows over the last three months alone. At the time, Mario Lupori, Chief Investments Officer at RateSetter, stated:
“Only 18 months ago the RateSetter ISA was an unknown quantity, but now the numbers speak for themselves. Our ISA has quickly attracted £250m and with a combination of steady, tax-free returns and well-managed risk it is becoming a real alternative to Cash ISAs. It’s clear that peer-to-peer investing is becoming a mainstream investment option.”
Other milestones that the ISA has achieved include:
- 25 open ISA
- £11,000 Average ISA balance
- £15 million tax-free interest returned
- £280 million currently invested in ISA
RateSetter previously stated that 1 in 3 RateSetter investors are earning interest tax-free with the RateSetter ISA, enjoying an interest rate of 4.5% per annum on average.