Zopa Celebrates Seven Years In The Business
Zopa celebrates its seventh anniversary by inviting its borrowers and lenders to celebrate with it at a party being held in London.
Here is the press release:
LONDON, 6th March 2012 – Zopa – the world?s first online peer-to-peer lender – celebrates its 7th birthday this week, coinciding with the Bank of England confirmation that British banks are now inflicting the highest charges ever recorded on consumer lending. In stark contrast, the rates agreed between Zopa?s borrowers and savers, with no bank involved – remain as low as 6% APR, undercutting even the most aggressive banks.
Giles Andrews, cofounder and CEO of Zopa said, “After 7 years, Zopa members continue to enjoy better rates on personal loans and savings than the banks offer. Meanwhile, despite their size and virtual monopoly, banks have struggled to even stay solvent, requiring huge taxpayer bailouts. Zopa has not needed a penny of taxpayer money and has continued to run the lowest risk unsecured loan book in the UK, proving that people are better than banks. With news from the Bank of England that banks are now inflicting the biggest lending charges ever, while we celebrate our birthday our members can celebrate their good financial sense.”
In a move that further underlines the very different relationship Zopa enjoys with its customers, it has invited all of its members to attend its 7th birthday party being held in London this Wednesday, where they will meet fellow borrowers and savers, the Zopa team and a number of personal finance journalists.
At Zopa, ordinary people bypass banks to grow their savings by lending money to other creditworthy people. By cutting out the inefficiencies of banks and their expensive branches and bonus schemes, both borrowers and savers get a far better deal. Creditworthy borrowers at Zopa can access a loan typically 20% cheaper than they can get from a bank, whilst lenders have enjoyed radically better returns than they could get from savings accounts. The average Zopa lender rate over the last 12 months has been 7.2% p.a. offering average returns of 5.7% p.a. (after charges and actual average annualized defaults). The default rate on Zopa loans remains at the lowest of any unsecured loan book in the UK, including the banks.
Since launch, Zopa has arranged more than £185 million in loans – all at rates agreed between borrowers and savers, with no banks involved. Zopa loans now account for between 1% and 2% of all new personal loans issued in the UK each month. In January Zopa arranged more than £8.2 million of loans – a new monthly record for the business.
Zopa is a member of the Peer-to-Peer Finance Association and complies fully with all of the Association?s Rules and Operating Principles, which provide important additional consumer protection. Full details of the Association?s Rules and Operating Principles can be seen at www.p2pfinanceassociation.org.uk.
What is Zopa?
Zopa is the world?s first online marketplace where people meet to lend and borrow money. Lenders get great returns and borrowers get low-cost loans. With no bank in the middle, both parties get better rates. Zopa now has now arranged more than £185 million in peer-to-peer loans in the UK. To find out more, please visit www.zopa.com.
What’s in it for consumers?
Lenders are enjoying a smart way of getting a return, alongside their savings and investments. The average Zopa lender rate over the last 12 months has been 7.2% p.a. offering average returns of 5.7% p.a. (after charges and actual average annualized defaults).
Borrowers are finding it a fair and human way of getting a low-cost loan. They are enjoying market-leading rates, with a representative APR currently of around 6.1% (based on £10,000 over 3 years), and the flexibility to repay their loan early at no extra cost. Unlike the vast majority of banks, borrowers at Zopa get their full personalized loan quote without leaving a mark on their credit file.
Anybody can become a member of Zopa for free, giving them access to the Refer-A-Friend scheme where they can earn £50 for each successful borrower they recommend and each lender they recommend who lends £2000 or more.
Risks are kept to a minimum
To protect lenders’ money, Zopa uses all the safety measures banks use, plus a few more. All borrowers are identity-checked, credit scored and risk-assessed. Lenders? money is lent out in £10 packets, each to a different borrower, so anybody lending at least £500 has their money spread across 50 borrowers to achieve an ideal diversification. Lenders can override this feature if they wish to gain faster take up of their offers if they are happy with the greater exposure that will result.
Zopa holds Consumer Credit Licences from the Office of Fair Trading and uses the same processes and fraud prevention systems as banks (including Equifax, Experian and Call Credit for credit rating).
Charges are simple, clear and low
Zopa runs a simple and transparent charging model: lenders pay an annual fee of 1% on the money they lend, and borrowers pay a fee of up to £190 which is added to their loan and reflected in the APR figures quoted. There are no hidden charges or any form of early repayment fee.
A growing trophy cabinet
– Winner of the „Most Trusted Personal Loan Provider? in the Moneywise Customer Service Awards for the last two years running (2010 and 2011).
– Voted one of Britain?s 100 most exciting, promising and disruptive new businesses by Smarta100.
– Runner-up to Twitter in the 2010 FT ArcelorMittal „Boldness in Business? awards for “Most Promising Newcomer”
– Winner of „Most Trusted Personal Loan Provider? and „Best Personal Loan Provider for Service? in the 2010 Moneywise Customer Service Awards.
– The Webby Awards – Best Financial Services Site 2008 and Best Banking/Bill-Paying Site 2007
– The International Retail Banking Awards – Most Threatening Non-Bank Competitor 2008
– The Banker Awards – Internet Project of 2007
– Red Herring 100 Award 2007
– CNet Technology Awards – Technology Project of 2007 and Internet Innovation of 2006
– Named by Business 2.0 as one of eleven disruptive companies “whose breakthroughs will change everything”, October 2006
– A five star review in What Investment magazine, the first time the publication has ever awarded a perfect score, August 2006.