Innovative Finance ISA

Smart investments, tax-free returns

  • Generate target returns of up to 5.2%
  • Tax-free up to £20,000
  • Easy transfer in from existing ISAs

Your capital is at risk. Fees apply when selling loans. Tax treatment depends on your circumstances and may be subject to change in the future.

Start investing
Learn more
Zopians discussing a project

We're fully regulated by the Financial Conduct Authority (FCA). But remember, this investment is not protected by the Financial Services Compensation Scheme (FSCS)

What is the Financial Conduct Authority (FCA)?

The FCA is the UK’s financial regulator. Its role is to make sure consumers get a fair deal, keep the financial services industry stable and promote healthy competition. Zopa is fully FCA regulated.

What is the Financial Services Compensation Scheme (FSCS)?

The FSCS is a compensation scheme for customers of financial services firms that have failed. It protects up to £85,000 if an authorised bank or building society goes bust. Our peer-to-peer investments are not covered by the scheme.

.

Excellent  five stars  9.7  out of 10

9,652 reviews on  five stars

What you need to know

What is an Individual Savings Account (ISA)?

An ISA allows you to earn tax-free returns on savings or investments. Each tax year you can put up to £20,000 into an ISA and any interest you earn on that is tax-free.

What is an Innovative Finance ISA (IFISA)?

This is simply another type of ISA. It includes all the same tax benefits, but your money is invested in peer-to-peer loans.

Why invest in Zopa’s IFISA?

Our IFISA works just like our standard peer-to-peer investments, but with the added bonus of the tax-free wrapper. Our target returns of up to 5.2% mean we’re nestled in the sweet spot between low-risk, low-return cash ISAs and the wild volatility of stocks and shares. What’s more, we don’t offer juicy introductory rates only to drop them later, so you can earn healthy returns year after year.

Who you invest in

Our IFISA invests in exactly the same type of personal loans as our standard peer-to-peer investments, the only difference is that returns are tax-free.

The people you’ll lend to come in all shapes and sizes, but we run checks on every single one. We only approve about 20% of those who apply for a loan with us. Everyone that we do approve is categorised from A*, the most reliable, to E, and given a personalised interest rate according to their risk assessment.

Based on applications via ClearScore May 2018 – May 2019, representative of Zopa’s borrower approval rates

How investing with Zopa works

1
Zopa splits your investment into small chunks. These are then put into a queue to be matched with different loans
2
We’ll work out how to distribute your investment so you’re set up match your target return.
3
You’ll receive monthly repayments, including interest but minus our loan servicing fee
4
Some loans default. We factor this in when calculating target returns
5
By letting us reinvest your repayments as they come in, you can earn interest on interest

IFISA investment tailored to your appetite

Just like our standard peer-to-peer investment, we offer two IFISA options, Core and Plus.

  • ISA Core and ISA Plus contain A*, A, B and C borrowers
  • ISA Plus adds higher risk D and E loans into the mix
  • Both allow you to enjoy tax-free returns on your peer-to-peer investment
ISA Core
ISA Plus
Target return

The target return we show is the net annual return we expect the average investor to earn. It is made up of a blend of the interest rates of the different loans you invest in, minus expected losses from defaults and our loan servicing fee (paid by the borrower). Your actual return could be higher or lower depending on the actual rate of defaults.

We sometimes revise our target returns based on the latest market conditions. If you choose to reinvest your repayments this will be done at the latest target rate.  

A 1% sale fee applies when selling loans early: this is not taken into account in the target return.   

4.5%
We expect investors to earn a net annual return close to this return.
Target return

The target return we show is the net annual return we expect the average investor to earn. It is made up of a blend of the interest rates of the different loans you invest in, minus expected losses from defaults and our loan servicing fee (paid by the borrower). Your actual return could be higher or lower depending on the actual rate of defaults.

We sometimes revise our target returns based on the latest market conditions. If you choose to reinvest your repayments this will be done at the latest target rate.  

A 1% sale fee applies when selling loans early: this is not taken into account in the target return.   

5.2%
We expect investors to earn a net annual return close to this return.
Borrower blend 

Our borrowers have to meet high standards. We only approve about 20% of people who apply for a loan with us.

Everyone that we do approve is categorised to assess their risk and given an interest rate personalised to them. The profiles range from A* to E. Our A* borrowers are the most reliable and E the riskiest. These decisions are informed by 14 years of lending data and the latest credit info from three major UK credit bureaus.

A*, A, B & C

Borrower blend 

Our borrowers have to meet high standards. We only approve about 20% of people who apply for a loan with us.

Everyone that we do approve is categorised to assess their risk and given an interest rate personalised to them. The profiles range from A* to E. Our A* borrowers are the most reliable and E the riskiest. These decisions are informed by 14 years of lending data and the latest credit info from three major UK credit bureaus.

A*, A, B, C, D & E

Typically, D and E loans are limited to 20% of your personal mix
Minimum initial investment

£1,000

Minimum initial investment

£1,000

Access to funds

No fixed term

Best results over the mid to long-term, but you can choose to access your money early by selling loans you have invested in. This process depends on demand from other investors to buy your loans so can take several days. A 1% sale fee applies.
Not FSCS backed

Not protected

Your capital is at risk and is not protected by the Financial Services Compensation Scheme (FSCS) when you invest.

How to fund your Zopa IFISA

  • You can simply pay in directly from your bank, up to the £20,000 allowance
  • If you’ve already got an ISA, you can transfer into ours from both previous and current year ISAs. This won't use up any more of your yearly tax-free allowance. Learn more about transferring in from other providers
  • If you already invest in our standard product, you can transfer uninvested funds into IFISA, or you could reinvest your standard repayments into IFISA

FAQs

What else do you need to know?

Ready to start investing?

You can open an account in a few minutes.

When you invest your money, your capital is at risk and is not protected by the Financial Services Compensation Scheme (FSCS). Our risk statement has all the details. Tax treatment depends on your circumstances and may be subject to change in the future.

We're here to help

Monday to Thursday (8am to 8pm), Friday (8am to 5pm)

We have savings and investment specialists on hand to assist you. UK residents only. Calls may be monitored or recorded.

020 7291 8331

contactus@zopa.com