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Now nudging £5 billion a year, peer-to-peer and crowd lending platforms have entered the mainstream during a post-financial crisis era in which investors increasingly want a say in where and how their money is invested.

Savers and investors now place a greater premium on transparency, choice and engagement – not to mention a (quite justified) focus on fees that can erode investor returns.

For those who want to back businesses they believe in, alternative finance can give investors the opportunity to invest in projects or companies they see as making a positive difference, though as with any investment your capital is at risk and returns aren’t guaranteed. This is not, after all, a cash ISA.

Take companies such as Warren Energy, a Norfolk-based renewable energy plant generating biogas through anaerobic digestion. Fundraising on the Downing Crowd platform gave investors the chance to lend to the company and earn annual interest of 6.75% over a 22-month term.

And in January this year Downing launched a new £3 million bond for Magnus Care Group, a care home developer, offering an initial interest rate of 7% p.a. with potential for added equity upside. The funds will support its work with Care Concern in acquiring further resident care homes, refurbishing properties, enhancing standards of care and increasing bed occupancy where appropriate.

Both investments were individual bonds that allowed investors to put their money into specific projects or companies they wanted to support. It’s one of the main reasons why 94% of investors on the Downing Crowd platform say they would prefer to choose bonds themselves, rather than let a platform, or an adviser for that matter, do it for them.

Many peer-to-peer platforms make loans on behalf of investors based on their own rules or algorithms, rather than giving them the opportunity to choose exactly where their money goes.

For investors who don’t want to see where their money is going, this can be an easy option with the advantage of diversification across a large number of smaller loans.

In contrast, platforms like Downing Crowd present investors with a smaller number of much bigger bond offers. This increases single investment risk but allows the platform to take both a hands-on approach to due diligence pre-investment and a more active role in overseeing how those funds are deployed and ultimately returned to investors.

For those who do want to see where their money is going and prefer to use their own judgement on the sectors they invest in or the businesses they back, bonds may trump loans as the better option for their tax-free IFISA.

To date Downing bonds have offered a weighted average interest rate of 5.9% p.a., with the added reassurance that our annual monitoring fee is contingent on investor returns.

So if you want to retain control over your investment decisions here’s the good news: there are lots of worthwhile businesses to invest in out there and platforms like Downing with ‘skin in the game’ that are truly incentivised on you getting your capital back with the returns you expected.

Capital and returns at risk. The Downing IFISA is open to UK residents over 18 only. Crowd Bonds are not readily realisable and are not covered by the Financial Services Compensation Scheme (FSCS). Any personal opinions expressed are subject to change and should not be interpreted as investment advice or a recommendation. Tax treatment depends on individual circumstances and is subject to change. Downing LLP is authorised and regulated by the Financial Conduct Authority (Firm Registration No. 545025).

Find out more www.downingcrowd.co.uk/IFISA