Envestors: Why High Net Worths should be looking at angel investing in a negative interest rate environment
Bank of England policymakers are hinting that the UK may be heading for negative interest rates, for the first time in history. The BoE has recently taken the total stimulus to £895bn, with an additional £150bn in stimulus announced last month.
In a negative interest environment, banks have incentive to lend more by making loans cheaper, but account holders would likely be asked to pay to hold money in a savings account. The first ones to do so would be High Net Worth Individuals.
Between negative returns on savings accounts, negative yield on bond holdings, an increasingly volatile stock market and a projected dip in property prices, HNWIs looking for investment opportunities should take a closer look at early-stage investing.
By supporting early-stage businesses, investors receive equity in the company and generous tax reliefs offered under the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS).
