Zopa's Chief Product Office Andrew Lawson told investors last week they launched a new credit risk scorecard; the scorecard is meant to better help the platform assess borrowers and what is behind their approval/denial; Zopa has seen higher than expected losses and has also cut down on lending to higher risk customers; Lawson explained how the new model will use traditional credit methodology mixed with data science. Source.
Zopa provides 2016 year end stats; in total they lent 680 million British pounds ($830 million); helped 20,000 people improve their home and 29,000 buy a car; the company also highlights several awards they won including Most Trusted Loan Provider by Moneywise for the seventh year in a row; the company struck many partnerships including offering phone finance with Unshackled, loans through personal finance app Pariti and a partnership with Airbnb; company also launched three new lending products for investors with varying risk and return profiles; in 2016 we also saw the first securitization of Zopa loans and learned of Zopa's plans to apply for a banking license. Source
After a break in new investor inflows, Zopa has reopened to investors; the firm closed its platform to new investments at the beginning of December; cited an imbalance in borrower versus investor demand; firm is now accepting new investments with a 4.2 million British pound ($5.24 million) platform capacity. Source
Zopa launched its Plus product one year ago; the Plus product is the firm's highest risk and highest return offering; investors are reporting a 6% short-term return for the loan investments which fall in two additional risk categories: D and E; since introduced the platform has lent more than 100 million British pounds ($124 million) from approximately 9,000 investors. Source
Zopa plans to reopen to new investors by end of the year after stopping investor on boarding earlier this year; they stopped taking new money because they were finding it harder to get good quality borrowers; they also saw a big jump in demand for their Innovative Finance Isa; while the plan for opening to new investors is targeted at year end it could be delayed by existing investor's Isa demand. Source.
Zopa, the industry's first P2P lender, has reached a new milestone, originating over 2 billion British pounds ($2.5 billion) in loans since 2005; according to Zopa the firm has originated 300,000 loans from 246,000 borrowers and has 75,000 investors; in the UK, Funding Circle is also close to reaching the 2 billion British pound mark with cumulative loan originations of 1.92 billion British pounds ($2.40 billion) since its launch in 2010. Source
Zopa will reduce its high risk loan exposure following reports on the UK market's consumer credit outlook; data shows consumer defaults and insolvency levels are increasing; the firm says it will seek to target more low risk borrowers; the changes will allow it to offer higher returns in some of its leading products; the company plans to publish a monthly blog post with its perspective on the consumer credit market. Source
The company's revenue increased from GBP20.6 million ($26.38 million) in 2015 to GBP33.2 million ($42.52 million) in 2016; its earnings also improved with a GBP -5.8 million (-$7.43 million) loss versus GBP -8.8 million (-$11.27 million) in 2015 and the company reported a fourth quarter operating profit; the 2016 results also showed loan originations increasing by 30% to GBP689 million ($882.4 million) in 2016. Source
Zopa has promised its investors it will speed up the time for selling loans on the platform after investors complained of loan sale times taking weeks; the platform has identified this as an issue, reporting in a blog post, "Recently, some of our processes have been running slower than normal, resulting in it taking longer for you to sell loans and access your money early."; Senior Developer Joe Hutchinson says the platform has been working to upgrade its technology with steady progress and it has more enhancements planned which will provide more capacity on the server improving performance significantly over the next few weeks. Source
Zopa has announced it plans to apply for banking licenses; company will be the first alternative finance platform to seek licensing as a bank; CEO Jaidev Janardana wrote to clients on Wednesday with details on the company's plans; Zopa will seek to offer deposit accounts and new lending products; requires Prudential Regulation Authority and Financial Conduct Authority licenses which the company expects to take 15 to 24 months. Source