While revealing a “refresher” of its lending policies, UK-based peer-to-peer lender, Zopa, announced that as of July 20th it has lent £2.46 billion and is lending around £80m per month.
“With the support of our customers, we have (as of 20 July 2017) lent £2.46bn since we launched in March 2005. We’ve grown a lot since we first started, and are now lending around £80m per month, that’s more than we did in the first 5 years. But, despite that growth, we’ve remained true to our principles.
“We stick to what we know best – consumer lending in the UK. All our loans are direct to individual UK consumers. We’ve built our track record and expertise of consumer lending in the UK over the past 12 years. We believe this helps us take better decisions on who to lend to, and under what conditions. It’s not just about experience; we use data to make better decisions, and our history, including through the 2008 financial crisis, provides a rich data source that determines our risk policies and loan pricing. This doesn’t mean that we will always get everything right, but we give ourselves the best chance to do so with our focus and prudent culture.”
Zopa also noted that it believes diversification is a key tool for the individual investor risk mitigation. The lending platform notably spreads investments across multiple loans, starting in £10 chunks, so that no one borrower has more than 1% of the overall investment. The maximum amount the lender lends to any individual is £25,000, not including fees. In regards to transparency, Zopa added:
“We recognise how important trust is. Key to building trust with our investors is being transparent about where their money is being lent. That’s why we’ve always shown individual investors which loans they own, and how they are performing, in their individual loan books. We also share the whole platform performance by publishing our entire loan book, and share up to date lending and performance data with the P2PFA on a quarterly basis. These principles remain core to lending at Zopa, and we remain committed to them.”