Saturday, June 15, 2024

Orca Raises Over £500,000 in Advance of ISA Launch

Orca has secured £574,280 in equity funding to help deliver its ambitious development plans in 2019, setting its eyes on the launch of a multi-platform ISA early next year. Over 400 investors committed to the peer to peer investment aggregator’s equity fundraise on the Seedrs crowdfunding platform in November. The Edinburgh and Belfast-based fintech business also secured funding from a number of venture capitalist funds and private angel investors. Notable investors include Northern Ireland’s TechstartNI, and Clarendon Fund Managers, as well as Scotland’s ESM Investments, an angel investment network comprised of 80+ high-net-worth individuals investing in early-growth-stage technology businesses.

Orca’s CEO, Iain Niblock, said:

“We’re delighted with the success of our recent funding round, particularly the response from the crowd who really got behind us. 2019 will be a landmark year for Orca as we roll-out new products to fulfil the needs of investors. The Orca ISA will be the first multi-platform ISA of its kind, combined with the launch of our Self-Select portfolio builder, we are confident that Orca can develop into the go to platform for peer to peer investing.’

Tax-efficient investing is the way forwards

A new ISA wrapper launched in April 2016. The Innovative Finance ISA (IF ISA) was a hallmark moment for the growing peer to peer lending industry. A tax wrapper to sit alongside Cash ISA and Stocks & Shares ISA elevated the P2P industry and supported the notion that it was emerging into a mainstream asset class. The number of IF ISAs opened grew 520% from tax-year 2016-17 to 2017-18; 31,000 were opened in 2017-18, demonstrating the popularity of IF ISAs as more launched onto the market.

Tax-efficient investing is a common trend in the P2P market. More experienced investors are transferring cash ISA money into their IF ISA to combat the effects of inflation eroding their savings.

Orca ISA

The Orca ISA will be a first of its kind in the market. Current ISA rules stipulate that people can divide their tax-year ISA allowance of £20,000 between ISAs (e.g, Cash, Stocks & Shares and Innovative Finance ISA) accounts however they wish. But, they may only subscribe current tax-year subscriptions to a single IF ISA each year. This means it is very difficult to build a diversified P2P portfolio which is wrapped in an ISA. Investors typically hold one P2P investment within an IF ISA, while the remaining P2P investments are held in taxable general investment accounts.

With the Orca ISA, investors can hold multiple P2P providers in a single IF ISA. Here are the key benefits:

· Invest in the Orca Model portfolio suitable for hands-off investors or Orca’s Self-Select portfolio for the more active investor

· Earn interest up to 6.5%

· Earn returns tax-free

· Diversify ISA money across multiple P2P providers

· Transfer old ISA money

· Invest ISA money at non-ISA P2P providers

The company is already building a Wait List of investors eagerly awaiting the launch of the ISA.

Self-Select portfolio builder

In addition to the launch of the Orca ISA, the P2P aggregator is also launching a new product to complement their existing Model portfolio product.

The Self-Select portfolio builder allows investors to implement their own strategies, selecting only the P2P providers and products they wish to hold in their portfolio. What’s more, investors can build their portfolio and hold it in the Orca ISA.

Orca currently integrates with 5 major P2P lenders, namely, Assetz Capital, Landbay, Lending Works, Octopus Choice and LendingCrowd. A range of new lenders are expected to integrate in 2019.

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