We offer a variety of different types of Debenture on Abundance. The returns you receive back from your investments are split into two elements – your investment return and your capital repayment. The type of investment return and whether you are paid back in instalments or in one lump sum will depend on each particular investment. Find out more about the different types below, but always remember to read the Offer Document (or Factsheet if buying on the marketplace) to get the full details about the investment.
You can get more details on the tax treatment for the investment income from the different types of Debentures in our Help Centre article How are my Cash Returns taxed?
Always remember, when you make any investment on Abundance your capital is at risk and your returns are not guaranteed.
Types of return
There are four different types of return paid by the investments on Abundance:
The investment income you receive is fixed and known at the outset of the investment.
The amount you are expected to receive for each payment may be constant or rising (some investments pay a fixed but increasing amount) but in both cases will be defined at the outset so you know exactly what you should receive with each return payment. The amount of interest income you receive is not directly linked to the performance of the underlying project.
The investment income you receive is directly linked to how the project or company performs in each particular period.
The Offer Document and Factsheet provide details of the estimated returns, which are based on a number of assumptions such as: the annual energy production, the price received for the electricity generated, and other costs. This means returns can vary from period to period based on the energy generated as well as other things like costs.
The investment income you receive is directly linked to inflation each year. The Offer Document and Factsheet give details of how the inflation link is calculated for each individual investment.
Similar to a fixed return investment, the interest income you receive is not directly linked to the performance of the underlying project but is linked to the rate of inflation.
The investment income you receive is linked to whether a certain event or events, happen in a certain period of time. An example might be that you receive an additional return if the project receives planning permission or meets certain development requirements to go ahead. The Offer Document and Factsheet give more detail on the trigger event(s) that impact your return.
Types of capital repayment
Depending on the investment, your capital will either be repaid in one lump sum at the end of the investment, or in regular instalments throughout the investment. Generally speaking our longer term investments will repay capital in instalments and our shorter term investments will repay at the end, but always read the Offer Document or Factsheet to get the full details.