Digital Bank Zopa Tops £2 Billion in Deposits

Young digital bank Zopa has surpassed £2 billion in deposits. The bank claims to be one of the fastest challenger banks to top this milestone. Zopa Bank is authorized and regulated by the Prudential Regulation Authority and by the Financial Conduct Authority.

Zopa started its existence as the first peer-to-peer lending platform, with many other Fintechs copying its model in the ensuing years. Two years ago, Zopa become a digital bank. While maintaining its lending services (but not P2P), it now offers more features to its users, aiming to become the UK’s best bank for saving and borrowing.

Zopa states that its P2P heritage, which brings over a decade of online lending experience, having originated around £7.5 billion in consumer loans, has helped it to evolve and define its future as a leading digital bank.

Zopa Bank touts its progress to date, noting that since launching in 2020, it has issued more than 350,000 credit cards and tripled its revenue per customer. It holds over £1.5 billion in loans on its balance sheet.

Regarding deposits, Zopa Bank aims to address “zombie” funds parked in current accounts with two offers:

  • The Smart Saver is Zopa bank’s mobile only, “hybrid” (easy access/notice) saving account offering top table rates, targeted at users at the beginning of the saving journeys. Attracted £850 million in 7 months.
  • The Zopa FTS is Zopa’s fixed-term savings account from £1000, earning a fixed rate of interest for the full term of 1-5 years. Attracted £1.15 billion in 24 months.

While Zopa Bank continues to perform well, the UK is one of the hottest digital banking markets, with several top competitors vying to usurp legacy banking institutions. While Zopa remains highly rated, it will need to continue to iterate and add features and services to continue to grow.

Zopa has long been expected to pursue an initial public offering (IPO), with some reports placing it in Q4 of 2022, but market conditions may delay the public offering. Zopa raised £220 million in 2021 and recently reported it had turned the corner on profitability. 

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