News round-up: Weds 21 October

  • SAVERS AND INVESTORS should be allowed by the government to put profits from all types of crowdfunding into tax-free Isas, without exemptions for ‘riskier’ corners of this increasingly popular market, according to Crowdbnk.

HM Treasury’s consultation on whether to include debt-based and/or equity-based crowdfunding as eligible investment vehicles for Isas (individual savings accounts) recently closed with the possibility that only debt-based crowdfunding will make the cut. However, Ayan Mitra, head of Crowdbnk, said this could lead to companies opting for debt-raisings over equity-raisings “regardless of which one was actually more suitable”. Mitra said allowing all forms of crowdfunding in Isas would boost funding for British business, but admitted a charter of principles should be established so investors can use crowdfunding platforms responsibly.

  • PERSONAL FINANCE EDUCATION in London has had a major boost following a promise from two major financial providers to keep funding money lessons across the capital.

Social enterprise Toynbee Hall confirmed that the Columbia Threadneedle Organisation and JP Morgan Foundation would continue to support the Money Mentors programme, pledging £90,000 and £200,000 respectively. A report from Columbia Threadneedle into the project earlier this year found that it had delivered a social return of £3 for every £1 spent.

  • BANKING COMPETITION has been hotting up recently with an offer of £150 from Clydesdale and Yorkshire Banks for anyone who switches to their current account before the end of November.

It follows similar offers by firstdirect and Co-op Bank in the past, while TSB has also jumped on the bandwagon by offering £125 for new current account customers. That offer only lasts until 2 November.

  • THE CREDIBILITY OF PENSIONS has been further knocked by news that a sizeable number of 30 and 40 somethings actually prefer using their Isas to save for the future.

Fidelity Worldwide Investment found that 15 per cent of people have opted for an Isa over a pension while 28 per cent will use an Isa alongside a workplace or private scheme. Fidelity’s associate investment director Maike Currie said the firm supported the idea of a retirement Isa, described as “a tax efficient alternative to run alongside a main pension scheme with savings locked in like a pension until aged 55”. The research quickly followed the recent closure of a government consultation into pensions tax relief.

  • HOUSE BUYING is still cheaper than renting in more than a third of Britain’s cities, according to recent figures from Zoopla.

The property search website found that homeowners in Glasgow are better off than their renting counterparts to the tune of £100 a month. But the opposite is true in areas like London, Cambridge and Reading, where consumers pay hundreds more to service their mortgages than they would in rent.

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