Each year, UK savers can invest up to £20,000 tax-free through their ISA allowance. For most people, that tends to mean choosing between the familiar options: cash ISAs, stocks and shares ISAs or lifetime ISAs.
But there’s another kind of ISA that is catching the attention of people who want their money to do more than sit passively in a portfolio or savings account.
The Ethex Innovative Finance ISA (IFISA) lets you put some or all of your ISA allowance to work funding organisations with a clear social and/or environmental mission. Investors receive tax-free potential returns, just like any other ISA, but their money is invested directly into businesses tackling urgent issues such as climate change, financial exclusion or community infrastructure.
And appetite for a nicer kind of ISA is growing. In 2025, over £1 million was transferred into the Ethex IFISA from other ISA providers, up from just over £680,000 the year before. It’s a significant jump, suggesting that more savers are waking up to the idea that their tax-free investments can contribute to real-world impact, not just financial outcomes.
Direct investing to tackle real problems
The last decade has made the stakes impossible to ignore. The climate crisis is not a distant risk; schools, households and public services are all feeling the impact of rising energy costs. At the same time, millions of financially underserved people in the UK are being pushed towards high-cost credit when unexpected expenses arise, deepening cycles of hardship and stress.
While policy change is essential, so is capital. Many of the organisations developing the solutions our communities need lack access to the funding they need to scale and grow, which is where the IFISA provides a valuable bridge.
Through Ethex, retail investors can choose IFISA-eligible bonds that directly support mission-led organisations, enabling everyday investors to be part of the funding mix that scales practical innovations.
The IFISA in action
Today, two organisations currently raising IFISA-eligible investment on Ethex illustrate the range of problems individual savers can help address:
1. Salad: tackling financial exclusion
An estimated 12 million people in the UK have poor or insufficient credit histories, leaving them locked out of mainstream credit and exposed to high-cost lenders. Salad provides fair and affordable loans to NHS and public sector workers, using open banking rather than traditional credit scoring to make underwriting fairer.
By investing via the IFISA, savers can support a business that is actively reducing reliance on payday loans, improving financial resilience and challenging a system that routinely penalises low-income workers.
2. Solar for Schools: accelerating the shift to renewables
On the other end of the spectrum is the transition to clean energy. Solar for Schools installs solar panels on schools across the UK and internationally, cutting carbon emissions while helping schools bring down their electricity bills and educate students about the future of energy.
It’s a model that supports climate action, financial savings for schools and environmental education creating a triple win, enabled in part by individual investors investing their ISA allowance.
Making better use of your tax-free allowance
The important thing about the IFISA is that it doesn’t ask people to sacrifice their financial goals to create positive change, it just redirects ISA investments toward impact. Unused ISA allowance disappears at the end of the tax year in April, and more people are now considering using it to support the kind of world they want to see. Others are choosing to transfer existing ISAs from previous years, recognising that their allowance could be actively funding solutions rather than sitting dormant.
With new IFISA-eligible bonds launching on Ethex soon, investors will have even more opportunities to align their tax-free investment choices with the outcomes society desperately needs.
A simple question for the 25/26 tax year
If you’re planning to use your ISA allowance (or considering transferring existing ISA balances), it’s worth asking a different kind of question this year: What is my money doing to create positive change? Because with the Ethex IFISA, it could be helping to tackle real problems and working towards a fairer, greener future, all while earning a potential tax-free return.
Find out more about the Ethex IFISA here: https://www.ethex.org.uk/ifisa
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong.
