LendingCrowd, the Edinburgh-based fintech lending business, said that transfers to its platform were more likely to come from cash ISAs than any other type of tax-free account.
The peer-to-peer lender, which launched in late 2014, was one of the first platforms to offer an innovative finance ISA (individual savings account) and now has three different investing options.
The firm’s analysis shows that, since launching its innovative finance ISA in February 2017, 66 per cent of transfers have been from cash ISAs.
Meanwhile, stocks and shares ISAs accounted for 18 per cent of transfers to LendingCrowd, and the remaining 16 per cent were from innovative finance ISAs previously held with rival fintech platforms.
Innovative finance ISAs were introduced by the UK government in April 2016 and can only be provided by platforms that are authorised by HM Revenue & Customs. They enable investors to earn tax-free interest and income on peer-to-peer loans.
Stuart Lunn, founder and chief executive of LendingCrowd (pictured above), said: “It’s clear that cash ISAs are falling out of favour among savers who are tired of seeing the value of their money eroded by inflation.
“Our innovative finance ISA is proving extremely popular, and we expect demand to continue rising rapidly as more people realise their money could be working much harder for them.”
Since its launch, LendingCrowd has facilitated more than 600 loans to small and medium-sized enterprises across Britain, totalling more than £53 million – with in excess of £12m loaned in Scotland.
To date, around 7,000 investors have signed up to the fintech platform.