peer-to-peer lending

P2P lending: rules to limit deposits come into force

New investors will not be able to place more than 10% of their assets in peer-to-peer (P2P) investments unless they have received financial advice, under rules from City watchdog the Financial Conduct Authority that come into force today.

This is to ensure that investors have clear, accurate information about what they are investing in and so that they do not over-expose themselves to risk.

The changes mean that P2P platforms will have to provide extra information, helping investors to make better-informed decisions.

How to strike a better balance in an era of lower returns

A balanced investment portfolio of around half in shares and half in bonds has historically served investors well by producing inflation-beating returns while protecting capital to some extent during turbulent times. However, with the outlook for both asset classes looking precarious, this strategy has lost much of its appeal.

Innovative Finance Isas: don’t let rewards blind you to the risks

On first assessment, peer-to-peer Isas – known officially as innovative finance Isas – appear to fill a hole in the Isa market. They are hybrids that operate between the relatively high-risk/high-return sphere of the stockmarket and the lacklustre but safe zone of cash. They offer a handy route to a reliable and diversified income stream. At the same time, investors can enjoy the feeling of disintermediating those nasty banks.

Should savers be seduced by peer-to-peer’s strong returns?

Innovative Finance Isas (IF Isas) were launched in April 2016, providing investors with a halfway house between the low-risk, minimal return cash Isa arena and the stock market risk of stocks and shares Isas – but they got off to a slow start. So what sort of choice is now available, and what risks and attractions are attached to these products?