Top 5 green investments for your IFISA

Written by Lori Campbell on 10th Jul 2024

Risk warning: Your capital is at risk and unlike other ISAs, IFISAs are not covered by the Financial Services Compensation Scheme (FSCS)

If you’re keen to invest directly in projects that are working to create positive change in the UK, you can do so through an Innovative Finance ISA (IFISA).

An IFISA is a type of ISA that allows you to include investments that have been made via crowdfunded bonds or peer-to-peer loans. As with any ISA, you can invest up to £20,000 per year without paying any tax on your returns or interest. They can be a great way to add some variety and colour to your investment portfolio.

Bear in mind that IFISAs are riskier than cash savings and the level can vary dramatically, so make sure you read the risk description of the one you are interested in carefully.

Here we round up our top five investments for a green IFISA:

Clean Energy – Triodos

Triodos – a Good With Money ‘Good Egg’ firm – has a share offer with the Bristol Energy Cooperative, a pioneering clean energy business.

The initiative aims to attract everyday investors interested in supporting green energy generation and local communities.

The Bristol Energy Cooperative will use the cash to develop new clean energy projects and add an additional one megawatt of solar energy to its portfolio.

The projects are expected to power nearly 300 homes over 25 years, save 1,000 tonnes of carbon dioxide emissions, and direct an estimated £130,000 into community projects.

The target raise is £1 million. Investors can contribute a minimum of £100 and a maximum of £100,000. The forecast interest rate is six per cent, dependent on BEC’s performance. 

 

‘Climate positive’ housing – Ethex 

Positive impact investment platform Ethex has a share offer with Hook Norton CLT (HNCLT),  a unique development of community-led, climate-positive housing.

Oxfordshire village Hook Norton is experiencing rapidly increasing house prices and many families and young people are being priced out of rental properties. HNCLT is looking to create twelve community-owned and permanently affordable homes, offered for rent and sale to local people at risk of homelessness. The energy-efficient homes will be powered by the site’s own renewable energy microgrid, making it independent of the national grid for around six months each year.

The target raise is £500,000 and minimum investment is £250. The forecast return is six per cent, dependent on HNCLT’s performance.

 

Helping vulnerable youth – Ethex

Ethex also has a bond offer with The Project PT, which creates outreach programs aimed at nurturing vulnerable youth through sports and fitness. Its inclusive community gym provides opportunities for young people to gain qualifications via educational initiatives.

From 2019-2020, less than half of children in the UK met the recommended amount of sport and exercise per day, and this figure gets worse when you adjust for socio-economic deprivation.

The Project PT believes that sport and exercise can change lives for the better, and is dedicated to working with disadvantaged kids as well as adults to make an active, healthy lifestyle accessible to all. Since launching in 2021, the company has grown its Oxford gym to 230+ members

The target raise is £350,000. Minimum investment is £250 and the forecast return is seven per cent, dependent on The Project PT’s performance.

 

Education finance – Lendwise

Lendwise, which launched in 2018, matches private investors with borrowers who want to fund their studies to further their career and therefore their earnings potential. It is the UK’s only peer-to- peer lender to specialise in education finance.

The platform provides fair and flexible loans to students who have the personal merit to take postgraduate courses at top business schools and universities in the UK or internationally – but maybe not all of the funding.

Meanwhile, lenders can target a competitive return on their investment of up to nine per cent per year while also making a positive social impact. The minimum initial investment is £1,000.


The Good Guide to the IFISA


 

Net zero councils – Abundance Investment

Sustainable investment platform Abundance is offering a five-year investment to help Hackney Council expand its

The council has one of the UK’s most ambitious climate action programmes. It has switched all its buildings to 100 per cent renewable electricity, installed zero carbon energy measures on buildings including the Hackney Empire, planted thousands of trees and made half of its streets better for walking and cycling by pioneering programmes such as School Streets.

This new investment is a way to let anyone support its climate action plans, and help it support local residents who are passionate about cutting emissions and creating local green jobs.

The target raise is £500,000 with forecast returns of 4.50 per cent per year, dependent on the council’s performance. Minimum investment is just £5.

 

Risk warning: Don’t invest unless you are prepared to lose money. These are high-risk investments. You may not be able to access your money easily and are unlikely to be protected if something goes wrong.

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