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Fast, flexible and fee-free: How Investment Backed Lending could help when opportunity knocks

IBL could provide quick access to funds for the next big thing in your life.

3 min read


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If you’ve invested for your future but also need some extra money much sooner – it’s possible to have both with Investment Backed Lending (IBL).

Whether you want to buy something that’s just come up for sale or simply need some extra cash, IBL could give you access to extra funds when you need them most, without disturbing what you’ve put away for your future.


What is Investment Backed Lending?

IBL can be thought of like an overdraft. It’s a form of financing that enables eligible clients to borrow against their investments without having to take any money out of their existing portfolio.

As you’re borrowing against your investment, time-consuming asset valuations aren’t necessary. So the process can be relatively quick – with everything agreed and set up in less than two weeks, rather than months.

This isn’t its only advantage though. The service has many potential benefits, including:

  • no fees – you don’t pay legal, valuation or arrangement fees
  • no fixed term repayment
  • multi-currency availability – IBL is available in five currencies: Pound Sterling, Euros, US Dollars, Swiss Francs and Japanese Yen
  • flexibility – you could borrow a single lump sum all at once or portions of it over time, and you only need to pay interest once you start using it
  • cost-effective – IBL offers beneficial rates so costs may be more favourable than other forms of borrowing

There are certain requirements to qualify for IBL though.

“You need to have a sufficient level of investments looked after by Coutts, at least £500,000, and you need to have a sufficient level of expertise and professional knowledge to move into this type of product,” said Travis Millyard, Director, Coutts International Private Banking.

"It starts with a conversation with your private banker to see if you’re eligible. If you meet the requirements, IBL could be a versatile funding tool enabling you to take advantage of personal or business opportunities when they arise."



At Coutts, we’ve had clients use IBL for everything from buying a classic car to purchasing an investment property.

For one client, a hedge fund manager, it was the perfect way to diversify their portfolio. They wanted to explore alternative investments and were looking at opportunities in the private equity space.

The client considered IBL as an effective way to do this as it leaves their existing investments untouched, but gives them the necessary liquidity to invest in a project as and when the right one emerged.

Some of our clients have also used IBL to borrow against their existing portfolio and invest in the UK Enterprise Fund – which we launched last year along with the UK’s leading growth-stage investor BGF to help innovative British businesses to grow.


This product may not be suitable for you if:

  • you require any advice on the merits or suitability of the product for you.
  • you have less than £500,000 invested with Coutts, which is the minimum amount required for Investment Backed Lending here
  • you rely on the income and capital from your investments and cash to maintain your standard of living

We strongly recommend you seek your own independent advice if you are unsure whether this product is suitable for you. We also recommend that you seek tax advice as this is not something we provide.

Before you borrow against investments, you should understand these risks:

  • If the security you provide is insufficient to support the amount you have borrowed, you may be required to rectify the shortfall at short notice – this is referred to as a margin call
  • If you borrow to purchase investments and these investments are themselves provided as security for your liabilities, your losses or gains could be magnified
  • If your borrowing is in a different currency to the limit, fluctuating exchange rates could result in the limit being exceeded and you may be required to rectify the shortfall at short notice – this is referred to as a margin call.
  • Lending secured over investments can have an adverse impact on the value of your investments. This risk is amplified if the funds are used for leverage purposes. Investment values can fall as well as rise, your capital is at risk.

The final decision whether to proceed must be your own and in making your decision you should carefully consider the comparison between borrowing costs and potential investment gains/losses.




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