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Octopus gives more Choice to Financial Advisers with launch of its Innovative Finance ISA

  • Tax-efficient way to invest in one of the UK’s fastest-growing P2P products
  • Targeting tax-free variable interest rate of around 4% per year
  • Loans secured against property at conservative loan-to-values

The Octopus Choice ISA will allow investors to target a tax-free variable interest rate of around 4 per cent per year on investments within their annual ISA allowance (currently £20,000 for the 2017/18 tax year).

Commenting, Sam Handfield-Jones, Head of Octopus Choice, said:

“Over the last year, financial advisers and their clients have shown tremendous appetite for this type of solution. At a time of low interest rates, rising inflation and ever-present stock market volatility, providing clients with an alternative option for their investments may have never been more important or valuable.

“We are thrilled that we can now help advisers include Octopus Choice within their clients’ ISA planning and we expect today’s launch to bolster the impressive demand we have already witnessed for this product.”

Octopus Choice was launched in consultation with financial advisers in April 2016, to coincide with the FCA’s decision to broaden the scope of advisers’ permissions to include P2P lending. Since then, it has become one of the UK’s fastest-growing P2P products, having already facilitated over £130 million of borrowing across nearly 200 deals.

Every loan is secured against property at conservative loan-to-values (currently averaging 60 per cent) and is underwritten by award-winning lending team, Octopus Property1. Since launch in 2009, Octopus Property has lent over £2.6 billion with a default rate of less than 0.1 per cent.

Octopus also invests five per cent in each loan at first loss, meaning investors can get their initial investment back first, as well as receive any interest due to them before Octopus receives any.

Octopus Choice was named ‘Most IFA Friendly’ at the AltFi 2016 awards – as well as being singled out as the ‘One to Watch’ – and has been shortlisted for the Innovation Award at The Investment Life & Pensions Moneyfacts Awards 2017.

Mike Searle, Director of Nouveau Wealth Management, added:

“From a client perspective, the concept behind Octopus Choice is very easy to understand: a client’s investment is secured against property so they have a safety net, while Octopus stands the first five per cent of any loss in the event that anything goes wrong. I genuinely believe P2P lending will become more mainstream in the years ahead. If advisers simply pass it by without a thought, I believe they are doing their clients an injustice.”

The Innovative Finance ISA was launched on 6 April 2016 as a new addition to the growing stable of ISA options. The IFISA allows savers to use some or part of their annual ISA investment allowance (currently £20,000 for the 2017/18 tax year) to receive tax-free interest on funds lent through FCA-regulated peer-to-peer lending platforms. Octopus Choice was granted full FCA authorisation at the beginning of the year.

Investors can split their £20,000 (2017/18 tax year) ISA allowance across multiple forms of ISA investing including, but not limited to, cash, stocks & shares and Innovative Finance ISA. However, the combined amount invested during the tax year must not exceed the limit.

 Tax treatment depends on the individual circumstances of each client and may be subject to change in future.

– Ends –

 Notes to editors:

1Awards include Best Development Finance Provider (Business Moneyfacts Awards 2017 & 2016) and Development Lender of the Year (Bridging & Commercial Awards 2017)

For journalists in their professional capacity only. The value of an investment, and any income from it, can fall or rise. Past performance is not a reliable indicator of future results. Investors may not get back the full amount they invest.  Personal opinions may change and should not be seen as advice or a recommendation.  We do not offer investment or tax advice. We recommend investors seek professional advice before deciding to invest. Unless otherwise stated, all data and factual information provided within this document is sourced to Octopus and correct at 24 July 2017.

Octopus Choice is a trading name of Octopus Co-Lend Limited, 33 Holborn, London EC1N 2HT, which is authorised and regulated by the Financial Conduct Authority.  The firm is on the Financial Services Register FCA registration number: 722801. Octopus Choice is being distributed by Octopus Investments Limited, which is authorised and regulated by the Financial Conduct Authority. Registered office: 33 Holborn, London, EC1N 2HT. Registered in England and Wales No. 3942880.