UK BOND Network is expecting to launch its Innovative Finance ISA (IFISA) in January, after receiving authorisation from the Financial Conduct Authority (FCA).
The peer-to-peer bond auction platform, which allows investors to buy secured bonds issued by UK businesses, was previously operating under an ‘appointed representative’ arrangement, acting under the regulatory umbrella of another company that would in effect guarantee its compliance.
New regulations came into effect on 1 November that allow crowdfunded debt securities in the tax-free wrapper, meaning UK Bond Network will be able to launch its own IFISA product once it gains ISA manager status from HMRC. This step is essentially a formality after receiving full FCA authorisation.
“We hope to have it in place in January, in good time for the next tax year,” David von Dadelszen, director at UK Bond Network, told Peer-to-Peer Finance News.
“We did a survey among our investors and there was a good amount of interest in the IFISA. We would expect a lot of existing and new investors to take up the product.”
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The company said that the authorisation process took several months, which will be met with frustration by some of the major peer-to-peer lenders who have been waiting more than a year for FCA approval.
A number of smaller platforms are able to offer the IFISA. Last month, Lending Works became the first major P2P lender to be able to offer the tax-free wrapper around its investments.
Chris Maule, chief executive and founder of UK Bond Network, said: “Stringent standards are at the heart of everything we do. We believe this approval will further strengthen the confidence that our investors and corporate clients have in our platform, services and people.”