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Post by Ton ⓉⓞⓃ on Mar 19, 2014 17:57:21 GMT
This is a request to Assetz Capital to launch an ISA. I believe there are cost to running an ISA such as more staff to do Admin, and assuming George Osborne or another government etc don't change their minds, can we have one please andrewholgate ? |
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Post by batchoy on Mar 19, 2014 19:06:01 GMT
It's jumping the gun a little bit to request an AC ISA. Reading all the paperwork surrounding the budget it becomes apparent there is more government consultation to be done with the P2P industry to look into the mechanics of having P2P loans in an NISA, following which there has got to be secondary legislation enabling the inclusion of P2P loans in an NISA. Given that the documentation talks about inclusion in an NISA, the absolute earliest that there can be one that accepts P2P loans is July but it is more likely to be much later so that companies can formulate their offerings once the secondary has been passed.
The big issue I see is that the NISA combines the current cash and stocks and shares ISAs so it will probably be unlikely that the P2P companies will be setting up their own ISAs. My view is that it will be more likely that some of those companies currently offering self select ISAs will add the option of including a P2P element by teaming up with the current P2P platforms to buy loan parts on behalf of their investors. The problem will then be the amount the investment companies charge in fees for managing the P2P element.
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j
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Post by j on Mar 19, 2014 19:42:50 GMT
I think most providers make no charges on CASH ISAs. Many others also charge nothing or very small percentage on stocks & shares ISAs. There are obviously exceptions to the rule but, they are far & few between due to competition these days. If a p2p platform knows what it's doing & has its finger on the pulse (AC has largely fallen into this category so far), then I can't see why they cannot have things organised by July (the earliest time apparently possible to quote BB) to launch. While we're at it, can we look at transferring current ISAs into p2p/AC? andrewholgate, chris?!  I'm now off to read the info about the new budget to see if I can retire at 84 instead of 85   |
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Post by pepperpot on Mar 19, 2014 20:38:44 GMT
andrewholgate - don't let the hungry hippos tempt you into revealing Saturday's big announcement early, it would spoil the surprise!!! I know you don't want to be out done by that little start-up Wellseley, who have just announced their intentions to offer a NISA, do you?  I'm now off to read the info about the new budget to see if I can retire at 84 instead of 85 Life is a whole lot easier for the young - retirement is likely going to be either short or non-existent, very little point in planning!
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Post by batchoy on Mar 19, 2014 21:14:37 GMT
andrewholgate - don't let the hungry hippos tempt you into revealing Saturday's big announcement early, it would spoil the surprise!!! I know you don't want to be out done by that little start-up Wellseley, who have just announced their intentions to offer a NISA, do you? I'm now off to read the info about the new budget to see if I can retire at 84 instead of 85 Life is a whole lot easier for the young - retirement is likely going to be either short or non-existent, very little point in planning! It's funny that Wellesley has managed to go from wrongly announcing that P2P loans weren't going to be included in ISAs to announcing they are aiming to be the industry's leading provider in a couple of hours. Whilst all the government has announced that it intends to included P2P loans in the NISA but as yet has to complete industry consultations on the mechanics of including P2P loans, and once it has completed the consultation has formulate and to pass legislation to enable it to happen. Only once this has been done will companies be able to formulate their products. It is worth noting that the governments reasoning for delaying the launch of the NISA to July is to allow vendors time to formulate their products following the necessary changes in the legislation.
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mikes1531
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Post by mikes1531 on Mar 19, 2014 22:26:11 GMT
While I agree that there's a lot more groundwork to be done before anyone could offer a NISA that includes P2P, I don't see any harm in making our desires known at this time. So I've added my Yes vote to the poll. On the other hand, I'd be surprised if AC wouldn't want to offer P2P NISAs if they could -- even without our asking.
PS. On another forum, someone suggested it would be good if the P2P Finance Association were to be able to create a NISA product that would allow investors to spread their NISA money over a variety of P2P platforms. It sounded like a great idea to me.
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j
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Post by j on Mar 19, 2014 22:46:10 GMT
While I agree that there's a lot more groundwork to be done before anyone could offer a NISA that includes P2P, I don't see any harm in making our desires known at this time. So I've added my Yes vote to the poll. On the other hand, I'd be surprised if AC wouldn't want to offer P2P NISAs if they could -- even without our asking. PS. On another forum, someone suggested it would be good if the P2P Finance Association were to be able to create a NISA product that would allow investors to spread their NISA money over a variety of P2P platforms. It sounded like a great idea to me. That is a great idea indeed. I think you'd need some form of broker to bring all p2p platforms under one umbrella for it to work.
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bugs4me
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Post by bugs4me on Mar 19, 2014 22:49:08 GMT
While I agree that there's a lot more groundwork to be done before anyone could offer a NISA that includes P2P, I don't see any harm in making our desires known at this time. So I've added my Yes vote to the poll. On the other hand, I'd be surprised if AC wouldn't want to offer P2P NISAs if they could -- even without our asking. PS. On another forum, someone suggested it would be good if the P2P Finance Association were to be able to create a NISA product that would allow investors to spread their NISA money over a variety of P2P platforms. It sounded like a great idea to me. Sounds like a great idea but as they always say after a budget - the devil is in the detail and that will gradually crawl out of the woodwork during the next few days.
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Post by batchoy on Mar 20, 2014 6:32:33 GMT
A lot of people including at least one of the P2P platforms seem to have gone of half cocked in the excitement of the Government's statement that they intend to include P2P loans in the NISA. Personally I think it is going to be a double edged sword good for the platforms as it will bring in more funds, but bad for investors as the influx of funds will potentially depress interest rates and the institutional investors will potentially out bid individuals due to the sheer size of their bids.
The Government has NOT announced a third P2P ISA, what it has announced is that existing Cash and Equity ISA's will be replaced by new cash and equity ISAs known as NISAs, in which investors will be able to hold a total of £15,000 balanced in any way they please, and that at some point after the launch of the NISA and subject to further consultation and legislation P2P loans will be added to the list of securities that can be held in the Equity NISA, however investors will still only be able to hold two NISAs that they are actively investing in, a Cash NISA and an Equity NISA.
Given that people will only be able to own one active equity NISA, smaller and right thinking investors (which probably makes up the majority) are not going to want to hold the whole of their Equity NISA in P2P loans and even more so not in P2P loans from a single platform, and if they seek advice they will probably be advised not to put all their eggs in one basket. What they are more likely to want is an NISA in which they hold a spread of eligible equities including a portion in P2P loans and in the case of the more sophisticated ones with self select NISAs the ability to rebalance the investment mix based on market conditions. As a result I don't see much of a market for P2P only Equity NISAs set up by the individual platforms and on cold reflection I think many of the platforms would not want to go down the route of the additional regulatory burden of running an NISA and would rather stick with what they are good at, letting other institutions handle the NISA business. What I do see is the existing institutions that supply Equity ISAs putting together Equity NISA packages that contain a portion that is invested in P2P loans. With the self select NISA the investor will probably be allowed to select the portion in P2P loans and possibly the platforms that the funds are through but they probably wont be able to choose loans themselves due to their low value and potentially short life.
The net result it will be that for equity NISAs with a portion of P2P funds it will institutions that are bidding on the P2P platforms with significant pots of money, not individuals with relatively small sums potentially resulting in interest rates being depressed and small bidders being out bid and forced off the platforms.
My advice to AC would be to keep your powder dry, don't announce an NISA as the only market for it will be the irresponsible investor, and the system tends to protect the fiscally irresponsible at the cost of the institutions, but put in place mechanisms that will ensure some degree of access to loans for individual lenders when the institutional funds start to come in.
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debeast
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Post by debeast on Mar 20, 2014 8:21:18 GMT
Goodness knows how a new NISA will work with S&S and Cash let alone introducing the P2x businesses as well.
But nice to know that some p2x businesses already are desperate to get their customers money into one.
The question to me though is how much will we be charged for the privilege by the few companies who can offer these complex NISA's?
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Post by batchoy on Mar 20, 2014 8:27:52 GMT
Goodness knows how a new NISA will work with S&S and Cash let alone introducing the P2x businesses as well. No different to the existing ISA, there will still be a Cash NISA and an Equity NISA it is just that there will be a total £15,000 limit that can be put in NISAs and there will be no restriction on how you balance your investment between the two that you are allowed to hold. P2P loans will just become one of a list of eligible securities that can be held in an Equity ISA.
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Post by yorkshireman on Mar 20, 2014 8:27:59 GMT
Just a thought.
If a FSA regulated P2P platform offered a NISA along the lines of RateSetter’s or Wellesley’s current models, i.e. the lender doesn’t lend directly to an individual or a firm, would that product be eligible to be covered by the Financial Services Compensation Scheme?
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Post by batchoy on Mar 20, 2014 8:41:45 GMT
Just a thought.
If a FSA regulated P2P platform offered a NISA along the lines of RateSetter’s or Wellesley’s current models, i.e. the lender doesn’t lend directly to an individual or a firm, would that product be eligible to be covered by the Financial Services Compensation Scheme?
No because FSCS only covers cash ISAs not equity ISAs and there appears to be no proposed rule change for the cash NISA and equity NISA. An equity NISA investing in P2P loans based on the Ratesetter and Wellesley models will be no different to an existing equity NISA that invests in the say the top 100 companies where you have no control over the actual investing.
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Post by oldatheist on Mar 20, 2014 9:18:17 GMT
Given that people will only be able to own one active equity NISA, smaller and right thinking investors (which probably makes up the majority) are not going to want to hold the whole of their Equity NISA in P2P loans and even more so not in P2P loans from a single platform, and if they seek advice they will probably be advised not to put all their eggs in one basket. What they are more likely to want is an NISA in which they hold a spread of eligible equities including a portion in P2P loans and in the case of the more sophisticated ones with self select NISAs the ability to rebalance the investment mix based on market conditions. I would have thought that any p2p NISA would likely to be classed as cash rather than equities, and my reading of the rules is that you are only allowed to open one cash and one equity NISA in a financial year so over time you can still hold multiple NISAs as you can with the current ISAs. I think the simplest models for p2p providers to introduce would be fixed interest fixed terms bonds so suppliers like RS and Wellesley are already half way there.
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Post by batchoy on Mar 20, 2014 9:33:48 GMT
Given that people will only be able to own one active equity NISA, smaller and right thinking investors (which probably makes up the majority) are not going to want to hold the whole of their Equity NISA in P2P loans and even more so not in P2P loans from a single platform, and if they seek advice they will probably be advised not to put all their eggs in one basket. What they are more likely to want is an NISA in which they hold a spread of eligible equities including a portion in P2P loans and in the case of the more sophisticated ones with self select NISAs the ability to rebalance the investment mix based on market conditions. I would have thought that any p2p NISA would likely to be classed as cash rather than equities, and my reading of the rules is that you are only allowed to open one cash and one equity NISA in a financial year so over time you can still hold multiple NISAs as you can with the current ISAs. I think the simplest models for p2p providers to introduce would be fixed interest fixed terms bonds so suppliers like RS and Wellesley are already half way there. The way the budget and supporting documents are worded P2P loan parts will be classed as equities not cash but nothing has been finalised, and it would make sense if that was the case given that cash ISAs are covered by FSCS, equity ones aren't and P2P lending is not currently covered by FSCS. Also how could you incorporate a portion of P2P loan funds in a cash NISA, whereas for an equity NISA it would simply be a case of an institution using a proportion of the invested funds to purchase loan parts on one or more platforms in addition to buying stocks, shares and bonds.
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