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Alan Arul, corporate finance adviser at Catalyst, said poor performance and a lack of transparency had hindered investors' perception of EISs. He observed EIS marketing material drew too much attention to their tax benefits and not enough to their other advantages.

"The key thing with EISs is the lack of information on histories and track records. It makes it hard for investors to get a sense of them. VCTs do put out a track record, for instance," he said.

"It's purely up to the investment manager to make the disclosure, and nine times out of 10 that's a no. It's important to make fund managers accountable for their performance."

He maintained the EIS Association should do more to assist the industry and perhaps introduce EIS sectors so investors could compare funds with one another. "They need to increase their awareness with investors and managers."

Martin Sherwood, director at the EIS Association, argued EISs were not doing as badly as some had made out. He pointed out that unlike VCTs, 80-90 per cent of EIS funds had been raised through small private offers and EISs were therefore under little obligation to disclose their histories.

"Not everyone is walking around saying they've done badly out of them," he said. "EISs range from high-risk, such as tech start-ups, to low risk. If you choose your asset-backed sector properly, you can do very well," he said, highlighting pubs as an example.

"In the fullness of time, there will be track records for EIS managers. I'm sure they will talk about their track record as it develops," he added.

Mr Sherwood said the EIS Association was currently doing a great deal on behalf of the industry, including an ongoing regulatory consultation with the Treasury.