Zopa

Zopa Bank Ltd. ([5]) is a British online bank which offers deposit accounts, personal loans and credit cards. It began as the world's first peer-to-peer lending company in 2005 and gained a full banking licence in 2020. The peer-to-peer side of its business closed in December 2021.

History

Zopa was launched in the UK in March 2005 as an arranger of peer-to-peer lending, connecting investors with individuals seeking loans.[6][7] It was founded in Buckinghamshire in 2004 by a team from the internet banking company Egg Banking.[8][9]

Zopa grew steadily[10] in the years prior to the 2008 financial crisis. It navigated the period with no losses to investors' capital and only a small dip in returns during 2008.[11][12]

In September 2016, the first portfolio of Zopa loans was securitised on the European markets.[13]

In January 2017, Zopa became the first UK based peer-to-peer lending company to lend more than £2 billion worth of loans.[14] Zopa became fully regulated by the Financial Conduct Authority in May 2017.[15][16] Following FCA authorisation, and HMRC approval as an Individual Savings Account (ISA) manager, Zopa started offering Innovative Finance ISA products in June 2017.[17]

In November 2016, Zopa announced its intention to apply for a banking licence so it could expand the range of financial products it offers to UK consumers.[18][19] In August 2018, Zopa obtained £44 million in funding for the launch of its new digital challenger bank.[20] In December 2018 the company was awarded interim banking licences by the UK financial regulators, the FCA and PRA.[21]

Retail banking services – including deposit accounts and a credit card – were launched in June 2020, soon after a full banking licence was awarded.[22] By March 2021, Zopa had attracted around £250m in fixed-term savings accounts and had become a "top ten" credit card issuer. In the same month, the company raised £20m further capital from its existing lenders.[23]

In June 2021, CEO Jaidev Janardana stated that Zopa could be taken public as early as the last quarter of 2022.[24] In October of that year, the company raised $300million from Softbank Vision Fund and other investors, implying a $1billion valuation.[25] A further £75m was raised from existing investors, not including Softbank, in early 2023.[26]

In December 2021, Zopa announced it would be winding up the peer-to-peer side of its business, including buying back the existing loans of investors.[27]

In early 2023, Zopa had around 850,000 customers, over £3billion in deposits and £2billion on loan. The company indicated that it expected to make a profit over the full year for the first time in its history.[26]

In February 2023, it was announced Zopa had acquired the Newcastle-under-Lyme-headquartered, 'buy now, pay later’ (BNPL) platform DivideBuy.[28]

In December 2024, Zopa raised $87 million in equity at a valuation exceeding $1 billion, prioritizing profitability and growth over an IPO amidst a sluggish tech IPO market.[29]

Products and services

Corporate identity

The company's main office is at London Bridge.[38] Since 2017, Zopa also has a development centre in Barcelona, Spain.[39]

The company's name comes from "zone of possible agreement", a negotiating term identifying the bounds within which agreement can be reached between two parties.[40]

See also

• Comparison of crowd funding services
• Neobanks in Europe
• Peer-to-peer lending

External links