Easier Access to Patient Capital Investing

The Financial Conduct Authority (FCA) is to explore changes to allow retail investors to invest in ‘patient capital’ through unit-linked investment funds.  This was announced last week following plans originally announced in the 2018 budget.

The FCA is looking into how UK authorised funds can be used to invest and make it easier to get access to patient capital investing as it tends to be institutional funds that currently invest.

What is patient capital?  Watch the video

Although no changes have been suggested to investment fund rules, the FCA wants to discuss ways to increase investment in ‘patient’ capital by retail investors which will provide long term investment capital for start-up tech firms, health research, socially responsible projects, green technology and other infrastructure to benefit the UK as a whole and for also for the UK to become a global research and tech hub.  Patient means what it says i.e.  being patient, not in the medical sense, but in the sense of investing for a longer period in ventures that may prove beneficial in say 5-10 years (i.e.  be patient for your returns) for the UK and the World as a whole. 

This is not in the short term but certainly in the longer term and given that it will still be venture capital investment in start-ups, it still carries a degree of risk and the FCA wish to ensure the appropriate level of investor protection will still be in place for consumers.