By <a style="color: #4bbb87;" href="https://www.zopa.com/">Zopa</a>

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<ul>
 	<li class="m_-1963184678613603115paragraph" style="text-align: left;">Zopa has been granted a full UK bank licence</li>
 	<li class="m_-1963184678613603115paragraph" style="text-align: left;">New bank will start by offering a fixed term saving account followed by an innovative credit card later in the year</li>
 	<li class="m_-1963184678613603115paragraph" style="text-align: left;">These new products will launch in addition to Zopa’s existing personal loan and auto loan products</li>
 	<li class="m_-1963184678613603115paragraph" style="text-align: left;">Bank will sit alongside Zopa’s peer to peer lending business formed in 2005 </li>
</ul>
LONDON,  24th June 2020:  Zopa has today been awarded its full bank licence, launching at a time when consumers need financial services providers to work on their behalf more than ever.
Zopa Bank will focus on better meeting the financial needs of UK customers in sectors where they have traditionally been poorly served, while also delivering an experience that matches their expectations of a digital-first company.  The new bank will be launching a new set of products, starting with a fixed term savings account. The Zopa Fixed Term Savings Account offers a competitive rate over 1-5 years at a time when rates are at a historic low. The account can be opened in as little as 7 minutes online and is protected by the Financial Services Compensation Scheme (FSCS) up to £85,000.
Building on its 15 year lending heritage in peer to peer, Zopa will also be introducing a credit card in the coming months which will include innovative new features designed to put customers in control of their borrowing.  The card will address the needs of customers who have had to put up with poor service and unclear pricing from their existing card providers. These new products will sit alongside Zopa’s existing offering of personal and auto loans and investment products.
Zopa’s entry to the banking market comes at a pivotal time for UK consumers.  While customer behaviour towards and expectations of banks has been shifting over the last decade, the current crisis has put increased focus on whether the traditional players are best equipped to help people manage their finances. Independent research commissioned by Zopa found that a fifth of UK adults (20%) said they had faced struggles contacting their bank during the coronavirus pandemic and a third (30%) said they wanted additional flexibility and better guidance from their main bank to help them during these uncertain times.
In stark contrast, Zopa offers an agile approach and has been able to innovate quickly through the crisis in order to better help its 300,000 existing customers – who have investments or loans with the company. At the onset of the coronavirus pandemic in the UK, Zopa adapted its technology at speed, introducing online assistance such as; dedicated help forms, an income and expenditure tool and a specific COVID-chatbot, all of which helped worried or affected borrowers to access information and help quickly, without the long waiting times experienced by many high street bank customers. The bank has also worked closely with leading debt charity, StepChange, integrating the charity’s 60 second debt checker and benefit calculator into its app, to offer further help to its customers. For investors, Zopa has been able to continue lending their money by rapidly iterating its lending criteria as the market changed.
Such interventions have meant that during the height of coronavirus (1March – 12 June 2020), 96% of Zopa’s Trustpilot reviews were either 4 or 5 star.
Jaidev Janardana, Zopa CEO, commented: “Now more than ever the banking industry needs innovative, agile providers who work on behalf of customers. At a time when people want great value, fair financial services products and simple, intuitive digital experience, Zopa offers consumers a compelling and credible alternative they can trust.
“Securing our banking licence enables Zopa to play a wider role in the financial lives of our customers, as well as offering much needed choice and competition to the wider market.
“Beyond the current pandemic, Zopa is uniquely placed to provide a compelling alternative to traditional banking by leveraging its significant technological and financial services expertise to offer a wider range of great products, including savings and credit cards, alongside its personal loans and investments.”
Zopa Bank will sit alongside its existing peer to peer business (Zopa Limited), as part of the overall Zopa Group.
Zopa has raised £140m, its largest funding round to date, enabling its banking entity to fulfil its regulatory capital requirements. The investment has been provided by IAG Silverstripe Partners, an investment arm of IAG Capital, the private investment group specialising in digital and technology - led businesses. IAG Silverstripe first invested in Zopa in October 2018.
Since pioneering the peer-to-peer lending industry globally in 2005, Zopa has helped half a million people enjoy better value personal loans or to grow their money through investments, created a new asset class, and redefined the experience people have come to expect from their financial provider.
Last year Zopa launched ‘Borrowing Power’ within its app, a unique tool which personalises actions to help customers improve their credit score enabling them to borrow at a lower rate. It also launched a market first direct to consumer car finance product in a sector ripe for transformation.
ENDS 
*Opinium Research. Total sample size 2,003 UK adults. Fieldwork was undertaken between 22 – 24 May 2020
About
Zopa launched in 2005 pioneering peer-to-peer lending and giving people access to simple, fair loans and investments. Since then, it’s helped half a million customers get the most from their money.
As a peer-to-peer lender, Zopa approves £1bn of personal loans per year,  has been voted Moneywise’s Trusted Loan Provider ten years in a row and is Moneyfacts’ Personal Loan Provider of the Year for 2020 – the sixth time it’s won the award.
In June 2020, Zopa was awarded its full banking licence. As it launches its next generation bank, Zopa’s ambition is to make more people feel good about money, providing simple, fair products that are easy to manage and using its tech know-how to provide a bank that’s fit for the future.
Zopa Bank Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Zopa Limited is authorised and regulated by the Financial Conduct Authority.
Contact: <a style="color: #4bbb87;" href="mailto:PR@zopa.com">PR@zopa.com</a> 
Press Office: +44 (0)203 751 1743
Tamsin O'Neill
Senior Press Officer
T: +44 (0)203 794 6048
M: +44 (0)7525 348 092
Press Office: +44 (0)203 751 1743
<a style="color: #4bbb87;" href="http://www.zopa.com/" data-saferedirecturl="https://www.google.com/url?q=http://www.zopa.com/&amp;source=gmail&amp;ust=1593073600566000&amp;usg=AFQjCNEC5iETY4EGwZnXqC6Ga6tqycqhBQ">www.zopa.com</a>

Zopa launches new digital bank, offering consumers a compelling alternative when they need it most

Posted by Julian Wadley on 05/06/19
<figure class="wp-block-image is-resized"><img class="wp-image-10161" src="https://blog.zopa.com/wp-content/uploads/2019/06/Zopa-big-bank-break-up-1-1024x724.jpg" sizes="(max-width: 767px) 89vw, (max-width: 1000px) 54vw, (max-width: 1071px) 543px, 580px" srcset="https://blog.zopa.com/wp-content/uploads/2019/06/Zopa-big-bank-break-up-1-1024x724.jpg 1024w, https://blog.zopa.com/wp-content/uploads/2019/06/Zopa-big-bank-break-up-1-300x212.jpg 300w, https://blog.zopa.com/wp-content/uploads/2019/06/Zopa-big-bank-break-up-1-768x543.jpg 768w" alt="" width="832" height="588" /></figure>
New research published by Zopa has revealed a fundamental shift in the way that Britons are now banking, as new technologies, a new breed of fintech entrants, and changing attitudes to the high street banks, shape the future of the sector in the UK.

Zopa’s research found that over half of British adults don’t think their banks operate with customers’ best interests at heart*, this, combined with the plethora of new entrants offering better value and ease of access, means that monogamous banking is a thing of the past.  Three quarters (71%)** of the UK adults surveyed stated that they no longer needed a relationship with their main bank, regarding it as purely functional.  In fact, the average person now has products with seven different financial providers.

After years of apathy, people are starting to look beyond the incumbents for better value and easier to use products, shopping around for a broader mix of features that better suit their banking needs.

And it is the current account that is undergoing the most significant change, with 1 in 3 people in the UK (34%) or 17 million adults now holding two or more current accounts, a 36% increase on the amount recorded in 2015.

Zopa’s research also found that 2 in 3 people in the UK are actively using products from banks and financial providers other than their main current account provider. The most popular products to hold away from the current account provider are motor, home and travel insurance (80%, 77% and 64% respectively); followed by investments (71%); stocks, shares and ISAs (66%) and fixed term savings (45%).   In addition, almost half of all people that have a credit card (45%) don’t have it with their main provider and 1 in 4 now look elsewhere for their regular savings account (27%) and instant access savings (26%).

This is the clearest sign yet that people are shunning “loyalty” to their main banks and instead actively seeking out the most appropriate credit card, personal loan, savings product or mortgage for them.

The Open Banking opportunity

Zopa says that while consumers are now enjoying a broader mix of financial products from a range of providers – in practice – the process of managing many different financial accounts is both complex and time consuming.

However, as Open Banking gathers steam amongst consumers throughout 2019 and into the future, people will be able to access a more complete view of all of their financial products and will be free to compare a variety of providers and products – essentially re-bundling their finances in an app of their choosing.

As that happens, people will naturally gravitate towards those financial providers which can deliver transformative value – whether financial value through their products, time value through ease of use, or valuable insights into managing their money better.

Jaidev Janardana, Zopa CEO, said: “The last decade of fintech revolution has fundamentally changed the way that people bank in the UK.  Technology is enabling consumers to take control of their own finances, resulting in traditional banking relationships becoming purely functional.  The apathy on which the traditional banking model has relied will soon be resigned to the past.

“Consumers now have more choice and are actively choosing to shop around for products and providers outside of the main banking relationship. The key to Zopa building a successful next gen bank will be delivering transformative value. We’ve demonstrated this already with our loans business – which has lent over £4bn to UK consumers, proving that savvy customers will consider new alternatives.”

Later this year, Zopa will launch its own savings and credit card products, plus a money management app harnessing the opportunity of Open Banking.

Conscious unbundling: our research on the big banking break-up

Posted by Jaidev Janardana on 04/06/19
<div class="post__featured-image"><img class="attachment-twentyseventeen-featured-image size-twentyseventeen-featured-image wp-post-image" src="https://blog.zopa.com/wp-content/uploads/2017/03/blog-jaidev.png" sizes="100vw" srcset="https://blog.zopa.com/wp-content/uploads/2017/03/blog-jaidev.png 670w, https://blog.zopa.com/wp-content/uploads/2017/03/blog-jaidev-300x134.png 300w" alt="" /></div>
<div class="post__content">

You may have seen that the Financial Conduct Authority (FCA) just announced new regulations which will cover peer-to-peer (P2P) investments.

We wanted to outline what this means for you as an investor, as well as our response.

What this means for P2P investors

Before we go any further, the headline for you is that nothing changes with your Zopa investment. You don’t need to do anything, your investment – rates, loan book, target return – are not affected.

We are comfortable that we are well positioned to comply with the rules, which come into force on December 9 2019. They call for many things that Zopa is leading the sector on already, so in some ways they are simply formalising our best practices.

For investors in P2P generally, there are lots of good things in the new rules. You can expect platforms to be more transparent with disclosures so you can easily assess their track record of performance, approach to risk management, the underlying asset class you are investing in and the platform operating model.

So, what has happened?

<a href="https://blog.zopa.com/2018/07/27/fca-regulator-reviews-p2p-sector/">The FCA announced</a> a ‘post implementation review of loan-based crowdfunding platforms’ in July last year. In other words,  they were considering additional regulations for P2P platforms. Today it <a href="https://www.fca.org.uk/publications/policy-statements/ps19-14-loan-based-peer-to-peer-investment-based-crowdfunding-platforms-feedback-final-rules">confirmed which rules it’s going to bring in</a>. As mentioned, the majority of these are reflective of how we do business already. But in addition, there will now also be appropriateness tests and marketing restrictions – which will place limits on how much some new investors can put into a P2P platform.

Existing customers of Zopa will not be affected by these limits. However, new customers to Zopa, who are not classed as ‘sophisticated’ or ‘high net worth’ investors, will start off with limits on how much they can put into a platform. Once they gain experience with the product, these restrictions will ease and they will be able to invest more. This actually reflects what we have seen over time from our customers who typically fund an initial amount and then build up their portfolio each year, as they get more comfortable with how the product works.

Why were these regulations brought in?

The FCA started to regulate P2P lending back in 2014 through a set of temporary regulations. Since then the peer-to-peer market has grown, bringing in many newcomers including platforms with more complex business models and a variety of different asset classes, ranging from high value loans like property development to smaller, personal loans, like Zopa offers.

These rules have been brought in to make sure that all the players in the sector meet the same standards, and they cover everyone – whether they’ve been in the business 14 days or 14 years.

What do we think?

Throughout the consultation period we have been in conversation with the FCA, and we’re broadly supportive of the new rules put forward. We have always believed strongly in a well-regulated industry and have lobbied for years for effective regulation.

We share the FCA’s view that investors need to recognise the risks of P2P lending and already require our customers to confirm they understand our product before they invest. We also have internal procedures in place to gather feedback from customers and make improvements based on this. Therefore, we are in favour of the proposed appropriateness tests as a way of gauging an investor’s knowledge of our specific platform and the associated risks, as well as their understanding of P2P lending more broadly.

We typically expect investors to build up how much money they have in Zopa over time and have always viewed P2P as part of a diversified portfolio of savings and investments. Therefore, we don’t see temporary investment limits on new P2P customers impacting our business. However, we are concerned that the introduction of these limits doesn’t take into account the diversity of risk levels to which investors are exposed across different platforms.

As the world’s first P2P platform we have 14 years’ experience in risk management and as specialists in consumer lending, benefit from the data available through the big three credit rating agencies. We don’t offer the highest returns in the sector but compete with traditional lenders for prime customers. Our approach of offering a low risk, well-diversified portfolio of personal loans saw us through the 2008 financial crisis and has generated over £250 million in interest for our investors.

What happens now?

Like we say, nothing changes for existing customers and you don’t need to do anything your end. The rules outlined by the FCA must be implemented by December 9 2019. We’ll be rolling out changes over the coming months.

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What the new P2P regulations mean for Zopa investors

Zopa is the UK's largest peer-to-peer lending service - bypassing banks and their high charges to put more back into the pockets of the UK's lenders and borrowers.
Zopa matches smart borrowers looking for lower-rate loans with lenders looking for higher interest. Since Zopa was founded in 2005, it has arranged more than £720 million in peer-to-peer loans and has been voted 'Most Trusted Personal Loan Provider' in the Moneywise Customer Service Awards for the past five years and Consumer Moneyfacts best overall customer service in 2014. Zopa has over 50,000 active lenders.

Zopa

Zopa is the UK's largest peer-to-peer lending service - bypassing banks and their high charges to put more back into the pockets of the UK's lenders and borrowers.

Zopa matches smart borrowers looking for lower-rate loans with lenders looking for higher interest. Since Zopa was founded in 2005, it has arranged more than £720 million in peer-to-peer loans and has been voted 'Most Trusted Personal Loan Provider' in the Moneywise Customer Service Awards for the past five years and Consumer Moneyfacts best overall customer service in 2014. Zopa has over 50,000 active lenders.

Chief Risk Officer

Amy is responsible for developing Zopa's overall approach to risk management and leading the control functions that make up Zopa's second line of defence. Prior to joining Zopa, Amy was the Credit Officer and Head of Risk Operations at Capital One UK. Amy has over 17 years' of experience in retail credit - leading credit risk, product and operational functions.

Amy Fisher

Co-founder and board member

Giles was one of five people who dreamed up Zopa in 2004. By 2007 he was CEO and became Chairman in 2015.
Zopa wasn't Giles' first venture. He co-founded Caverdale which he took from a start-up to a £250 million revenue motor retailer, before selling it in 1997.
After Caverdale he set up his own strategic consultancy. It had large clients in the General Retail and Financial Services sectors and provided start-up advice and early stage funding for new businesses.
Giles received an OBE for services to financial services in the 2016 New Year Honours list, and is currently a non-exec Chairman of Dynamic Credit, an asset manager and direct mortgage lender in the Netherlands.

Giles Andrews OBE

CEO, Zopa

Devoted to creating simple and fair financial products and services, Jaidev joined Zopa in October 2014. Since then Zopa has secured its banking license to offer its customers a wider range of financial products, increasing its lending volumes six fold and growing its revenue 15x (as of 2022). Before Zopa, Jaidev spent 12 years at Capital One. Starting out in McLean, Virginia, he was initially focused on the US card business. He then moved to the UK in 2007 with a big task at hand – to manage credit risk through the financial crisis as Chief Credit Officer for the UK business. Having helped Capital One UK successfully navigate through the crisis, he took on the broader role of Chief Marketing Officer and was instrumental in returning the UK business back to profitability and growth.