Investments 

Firms urged to get up to speed on P2P loans

The managing director of Trillion Fund, the crowdfunding platform, said clients increasingly were interested in investing in crowdfunded companies and projects but advisers were being slow to catch on.

She said: “Clients might be interested in this kind of product, which is secured against operational, revenue-generating assets. We would love to see more advisers including this kind of deal in the scope of products they offer.”

Earlier this year, the Treasury said it would open a consultation this summer on how to include peer-to-peer loans in advice permissions, following its announcement in the Budget that peer-to-peer investing would be included in Isas from next April.

In March, the FCA published a policy statement outlining its plans to regulate crowdfunding platforms.

Ms Groves’ call to advisers came as the UK’s biggest peer-to-peer-financed wind energy project to date was announced, with a target of raising £5m this year to finance new turbines across the country.

Investors are being offered a 7.5 per cent bonus rate for those lending before 31 July, reverting to a 7.25 per cent standard rate thereafter. The minimum investment threshold is £50 with no maximum.

Ms Groves added: “Renewable energy projects offer unique, asset-backed returns because they generate a steady, relatively predictable income flow from the feed-in tariff they receive and the electricity they send to the grid.”

Bubble

£1,225

Return on a £1,000 loan after thre years

Adviser view

John Ditchfield, director of London-based Barchester Green Investment, said: “IFAs are regulated by the FCA and we have it breathing down our necks. We will look at crowdfunding products, but given that it is only three or four years old, it is reasonable that we are treading carefully given that we are dealing with other people’s money. IFAs have a duty to their clients that the recommendations they give have a reasonable degree of security.”

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