Exchange-traded funds (ETF) investment platform, InvestEngine, has today launched its new Savings Plan feature for customers in the UK, giving both new and experienced investors an easy solution to regularly transfer their income and savings into investments.

Utilising the latest innovations in open banking technology, Savings Plans will allow investors to make regular, diversified investments with greater ease and flexibility, creating a ‘little and often’ investment culture. 

They will also help to open the door to less experienced investors. With 30% of UK adults feeling like investment is not for people like them*, the new Savings Plan feature enables consumers to invest as little as £10 a week in an ETF portfolio, helping more people to take those first steps towards regular investing. 

Replicating the success of savings plans in Europe

Over the last few years, ETF savings plans have become an increasingly popular way for people to invest and save for their future, with significant growth in both the US and parts of Europe. In Germany, for example, ETF savings plans are projected to hit 20 million in number by 2026 – equivalent to a quarter of the population. Separately, the overall volume invested into ETFs by retail investors globally is expected to reach €350 billion by the same year. 

The launch of new Savings Plans by InvestEngine looks to not only replicate, but build on the success of savings plans seen in Europe. This includes giving investors significantly more flexibility in how they invest in a portfolio of ETFs. 

Rather than being restricted to purchasing and trading entire units of ETFs, which has been more commonly associated with savings plans elsewhere, InvestEngine’s users will be able to take advantage of automated fractional investing and purchase a fraction of any ETF on their platform from just £1. This also ensures that no funds are left dormant in an investor’s account, and instead means that every penny is invested and working towards growing their wealth. 

Andrey Dobrynin, Co-founder and Managing Director at InvestEngine, said: “ETF savings plans have grown significantly in popularity around the world as a simple, low-risk way for people to invest little and often, and grow their wealth.

“While we have seen our financial lives transformed by tech innovations in recent years, the way we invest has not always kept pace, and is restricting people’s ability to put their money to work for the future.

“With the launch of our Savings Plans, we’re utilising the latest innovations in automation and investing, building on the success seen in countries like Germany and helping make the UK the investing capital of Europe.”

By bringing the latest innovations in Variable Recurring Payments (VRPs) to its platform, InvestEngine is enabling people to automatically invest as little as £10 - weekly, fortnightly, or monthly - from a bank account of their choice. Once received, it will be automatically invested based on the chosen investments. New funds are automatically invested according to the target weight set in the investor’s portfolio without them having to lift a finger. 

Savings Plans users will have access to the same accounts, including InvestEngine’s fee-free ISA, the same range of 550+ commission-free ETFs, and will be able to choose to manage it themselves or have InvestEngine build and manage a portfolio that meets their needs. 

Growing ETF awareness

The UK, together with Switzerland, were the leading ETF markets in April as the industry continues to grow in size. However, the majority of people in the UK have little awareness of ETFs. Research by InvestEngine found that less than half (47%) of people had heard of them, significantly below mutual funds (71%) and cash and stocks & shares ISAs (both over 90%).*

This is despite many people saying they choose investment or savings products based on factors which ETFs can provide, such as low fees (46%) and low risk (59%).* ETFs are becoming more popular due to their simple and diversified nature, coupled with vast amounts of choice.