Zopa
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| Company type | Ltd. |
|---|---|
| Industry | Peer-to-peer lending |
| Founded | United Kingdom (2004) |
| Founders | Giles Andrews James Alexander Richard Duvall David Nicholson Tim Parlett |
| Headquarters | , |
| Products | P2P lending |
| Website | www |
Zopa is a UK online personal finance company. It was founded in 2005 as the world’s first peer-to-peer lending company, allowing its investors to lend directly to UK consumers through unsecured personal loans.[citation needed] In November 2016 Zopa announced its intention to apply for a banking license so it could expand the range of financial products it offers to UK consumers[1]
As of February 2017, Zopa has lent over £2 billion to UK consumers through its platform.
History
Zopa was founded in Buckinghamshire in 2004 by a team from the internet banking company Egg Banking[2], and originated its first loan in 2005. It was the first peer-to-peer lending company and one of the earliest fintech firms.[3]
Zopa is the only UK peer-to-peer lending company to have operated throughout the Financial crisis of 2007–2008.[citation needed]
Since then, Zopa has grown rapidly, doubling in loan volumes every year between 2013 and 2015.[4]
In August 2015, Zopa became the first UK peer-to-peer lending business to lend £1 billion[5] and in January 2017 it became the first to lend £2 billion[6]
In September 2016, the first portfolio of Zopa loans was securitised on the European markets,[7] receiving the highest debut rating of any marketplace-backed securities.[8]
In November 2016, Zopa announced that it would apply for a banking license.[9]
Business Model
Peer-to-peer lending
Zopa enables investors to lend to UK consumers directly through its peer-to-peer lending platform.
Borrowers can take out loans between £1,000 and £25,000, and typically use these to buy a car, consolidate debts or pay for home improvements. All applicants are credit-checked by Zopa.
Investors’ money enters a queue to be lent in one of three products, which vary according to the risk, returns and accessibility they offer. Once the money reaches the front of the queue, it is split into micro-loans that go to multiple borrowers. Investors then receive monthly repayments of interest and capital, which they can relend to compound the interest.
Zopa makes money by charging an origination fee on loans and a withdrawal fee of 1% on two of its investing products.
Safeguard
In May 2013 Zopa introduced its Safeguard Fund, which covers investors’ losses if a borrower defaults. This was because peer-to-peer investors could then not offset their losses against tax.
The Safeguard Fund has paid out all losses to date, but there is no guarantee it will do in the future.[10]
Performance
It publishes its full loan book each month on AltFi.com.[11]
Bank launch
Zopa’s bank is scheduled to launch in 2018 and will sit alongside the peer-to-peer lending business. At launch, Zopa plans to offer FSCS protected deposit accounts to savers and overdraft alternatives to borrowers.[12]
Products and services
Operations
Current operations
Zopa operates only in the United Kingdom.
Registered users
| Year | # of |
|---|---|
| 2017 | |
| 2016 | |
| 2015 | |
| 2014 | |
| 2013 | |
| 2012 | |
| 2011 | |
| 2010 | |
| 2009 | |
| 2008 | |
| 2007 | |
| 2006 | 50,000[13] |
| 2005 |
Defunct operations
The New York Times reported in 2006 that then Zopa CEO Richard Duvall announced that Zopa "planned to start a site in the United States to compete with Prosper this year."[13]
In 2006 it launched in the USA and Italy, but these operations have since closed.
Finances
- Funding
In 2006 the New York Times reported that Benchmark Capital was backing Zopa.[13]
In 2014 the Financial Times reported that the London-based hedge fund Arrowgrass Capital Partners had invested £15m.[14]
Zopa is backed by Bessemer Venture Partners, Augmentum Capital and Runa Capital.[citation needed]
Partnerships
- Partnerships
It has established partnerships with other challenger businesses, including Uber[15], Airbnb[16] and Metro Bank[17]
- Peer-to-Peer Finance Association
Zopa is a founding member of the [Peer-to-Peer Finance Association](url = http://p2pfa.info/), which was established in 2011. Giles Andrews, Zopa’s then CEO was its inaugural chair. Along with the other P2PFA members, Zopa publishes details of its loan book on the P2PFA website each month.[18]
Corporate affairs
Corporate leadership
CEOs
Since founding in 2004
- Richard Duvall (?–2006–?)[13]
Corporate identity
Headquarters
The company is currently based in London Bridge[19]
Brand
Zopa etymology
Its name stands for "Zone of possible agreement", a negotiating term identifying the bounds within which agreement can be reached between two parties.
Logo design
-
?–2014–?
-
?–present
Industry
By 2014 the Financial Times reported that the largest peer-to-peer loan platform was Lending Club and within Europe it was Zopa.[14]
Market Composition
In 2008 the New York Times reported that "Prosper, Zopa, Lending Club and others bring together would-be lenders with small-business borrowers."[20]
See also
References
- ^ Butcher, Mike (30 January 2014). "P2P Lending Pioneer Zopa Closes $25m From Hedge Fund For UK Expansion". TechCrunch. AOL Inc. Retrieved 3 October 2015.
- ^ Evans, Judith (14 August 2015). "My Money — Giles Andrews, Zopa chief". Financial Times. Nikkei. Retrieved 8 March 2017.
- ^ "Q&A: Online lending exchange". United Kingdom: BBC. BBC. 7 March 2005. Retrieved 4 July 2016.
- ^ Williams-Grut, Oscar (17 August 2015). "Peer-to-peer lender Zopa is growing like crazy and will do £1 billion next year". No. Finance. United Kingdom: Business Insider. Business Insider Inc. Retrieved 26 November 2015.
- ^ Haslett, Emma (18 August 2015). "Zopa becomes the first UK peer-to-peer lender to crash through £1bn of loans". No. Money. United Kingdom: City A.M. City A.M. Limited. Retrieved 8 March 2017.
- ^ Williams-Grut, Oscar (30 January 2017). "Peer-to-peer lender Zopa passes £2 billion loans milestone". No. Finance. United Kingdom: Business Insider. Business Insider Inc. Retrieved 8 March 2017.
- ^ Hale, Thomas (26 September 2016). "Debut securitisation for Zopa loans". United Kingdom: Financial Times. Nikkei. Retrieved 10 November 2016.
- ^ "Zopa issues first securitised loans package".
- ^ Hurley, James (17 November 2016). "Peer-to-peer lender Zopa to launch bank". No. Business. United Kingdom: The Times. Times Newspapers Limited. Retrieved 8 March 2017.
- ^ Duggan, Kate (3 June 2015). "Innovations in ethical investment". United Kingdom: Co-operative News. Co-operative Press Ltd. Retrieved 8 March 2017.
- ^ "Loanbooks".
- ^ Suter, Laura (16 November 2016). "Peer-to-peer giant Zopa to launch digital bank". No. Money. United Kingdom: The Telegraph. Telegraph Media Group Limited. Retrieved 8 March 2017.
- ^ a b c d Tedeschi, Bob (13 February 2006). "It's Like Lending to a Friend, Except You'll Get Interest". No. Technology. New York, N.Y., United States: New York Times. The New York Times Company. Retrieved 9 March 2017.
- ^ a b Moore, Elaine (29 January 2014). "P2P group Zopa secures £15m investment from Arrowgrass Capital". United Kingdom: Financial Times. Nikkei. Retrieved 9 March 2017.
- ^ Hall, Joe (6 May 2015). "Uber teams up with peer-to-peer lender Zopa to help drivers buy their own cars". United Kingdom: City A.M. City A.M. Limited. Retrieved 8 March 2017.
- ^ Hurst, Samantha (7 October 2016). "Zopa Announces New Partnership With Airbnb to Help Customers Pay Back Home Loans". Crowdfund Insider. Crowded Media Group. Retrieved 8 March 2017.
- ^ Dunkley, Emma (18 May 2015). "Metro Bank strikes deal to lend through P2P site". No. Banks. United Kingdom: Financial Times. Nikkei. Retrieved 8 March 2017.
- ^ "Peer-to-peer Finance Assocation".
- ^ Hurst, Samantha (4 August 2016). "Zopa Relocates: Moves Into New London Bridge Digs". Crowdfund Insider. Crowded Media Group.
{{cite news}}:|access-date=requires|url=(help) - ^ Fost, Dan (30 September 2008). "Likes Taking Risks, Profitable Returns". No. Small Business. New York, N.Y., United States: New York Times. The New York Times Company. p. SPG5. Retrieved 9 March 2017.