Zopa Wins Banking License, Will Offer Fixed-Term Savings Product
Zopa has won its banking licence, creating the world’s first hybrid peer-to-peer lender and digital bank.
Over the next twelve months, Zopa Bank will start rolling out a series of new features, including a fixed term savings product which will be protected by the Financial Services Compensation Scheme (FSCS). The new challenger bank will also offer credit cards and a money management app for customers.
These new products will sit alongside Zopa’s existing P2P business, where lenders can earn tax-free returns of up to 5.2 per cent via the Innovative Finance ISA (IFISA).
Zopa was one of the first P2P platforms to launch in the UK, and it has lent more than £3bn to UK borrowers over the past 13 years.
“Acquiring our banking licence is the starting point for Zopa to become a major force in retail banking,” said Jaidev Janardana, chief executive of Zopa.
“When we pioneered the P2P lending model globally in 2005, we did so by listening to customers and creating a better product for them. We will bring the same focus to our banking products – drawing on tech innovation, our values of fairness and transparency, and better customer service to help even more people to feel-good about money.”
According to Zopa’s own research, more than half of British adults don’t think their banks operate with customers’ best interests at heart, while 30 per cent say that their bank should provide a fairer service.
Zopa Bank aims to challenge the UK’s traditional banks by giving customers a fair deal as standard, with no hidden fees. It has also pledged to “make sure money management is no sweat” by offering cutting-edge tools via its app.
Janardana said that this is all part of Zopa’s overarching plan to go beyond ‘good enough’ and bring more innovation to the financial services sector.
Updated: Friday, December 14th, 2018