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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. Take 2 mins to learn more
Estimated reading time: 2 min
Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.
What are the key risks?
You could lose all the money you invest
If the business you are investing in fails, there is a high risk that you will lose 100% of your money. Most start-up and early-stage businesses fail.
Advertised rates of return aren’t guaranteed. This is not a savings account. If the borrower doesn’t pay you back as agreed, you could earn less money than expected. A higher advertised rate of return means a higher risk of losing your money. If it looks too good to be true, it probably is.
Certain of these investments can be held in an Innovative Finance ISA (IFISA). An IFISA does not reduce the risk of the investment or protect you from losses, so you can still lose all your money. It only means that any potential returns will be tax free.
Checks on the businesses you are investing in, such as how well they are expected to perform, may not have been carried out by the platform you are investing through. You should do your own research before investing.
You won't get your money back quickly
Many bonds last for several years, so you should be prepared to wait for your money to be returned even if the business you’re investing in repays on time.
You are unlikely to be able to cash in your investment early by selling your bond. You are usually locked in until the business has paid you back over the period agreed.
The platform does not offer a secondary market. While another investor may be interested in buying your investment, there is no guarantee you will find a buyer at the price you are willing to sell.
Don’t put all your eggs in one basket
Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well. A good rule of thumb is not to invest more than 10% of your money in high-risk investments.
You are unlikely to be protected if something goes wrong
Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here.
Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated platform, FOS may be able to consider it. Learn more about FOS protection here.
If you are interested in learning more about how to protect yourself, visit the FCA’s website here.
For further information about investment-based crowdfunding, visit the FCA’s website here.
Accelerating the electric vehicle sector in Africa
7 November 2022
Watch Energise Africa with representatives from the Carbon Trust, Mobile Power, Zembo & Bisedge for an interactive online discussion to discuss the growing e-mobility sector in Africa and why investing in its continued growth is critical to lives, the environment and the economy.
Our panel of experts discussed the benefits of the continent’s switch to electric transport in relation to several of the UN Sustainable Development Goals (SDGs), including health, gender equality, poverty, economic growth and climate action.
We learned about the Powering Renewable Energy Opportunities (PREO) Programme, supported by the IKEA Foundation and UK aid, and delivered by the Carbon Trust and Energy 4 Impact, which stimulates energy demand in rural Africa as a way of creating sustainable jobs and reducing poverty through economic growth and empowering women.
We also look at the ecosystem of the current e-vehicle market, the value chain and its future projections along with its potential to create a significant social, economic and environmental impact and accelerate Africa’s net-zero journey.
We were joined by representatives from Bisedge, Zembo and Mobile Power - African businesses that aim to make the transition to electric vehicles more accessible for people in Africa, and heard case studies on what they do within the sector ecosystem and why funding grants and investment from UK investors are vital to their future success.
Chair: Lisa Ashford, CEO Director, Energise Africa
Jonathan Booth -Manager, Carbon Trust & PREO
Segun Olumuyiwa - CFO, Temitope Oduntan - Admin Manager, Bisedge
Elissa Ferron - Zembo
Luke Burras - COO, Mobile Power
Please note that investing via Energise Africa, capital is at risk and returns are not guaranteed
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