Fintech firm Zopa to launch ‘next-generation’ bank to enhance peer-to-peer business

Zopa, UK’s leading peer-to-peer platform, announced its plan to launch a ‘next-generation’ bank in order to improve their market-leading peer-to-peer business.

“We launched in 2005 to create a richer life for everyone by making money simple and fair. We have lent over £1.8bn and inspired a £100bn global industry. We have built a profitable, scalable and viable business. Yet we’ve only just begun. We want to launch a next generation bank to drive greater choice for borrowers, savers and investors, which is good for consumers and good for the economy,” Jaidev Janardana, CEO of Zopa said.

The next generation bank will expand Zopa’s current suite of investor and borrower products. It offers FSCS protected deposit accounts in order to savers and overdraft alternatives to borrowers. The application for a banking license will be made to the Prudential Regulation Authority (PRA), and the Financial Conduct Authority (FCA), the release said. The regulatory application processes are in early stages and applications are expected to take 15-24 months.

Zopa will gain further diversified sources of funding by adding a next generation bank to their pioneering peer-to-peer lending platform. The diversity of funding will offer a strategic advantage over pureplay banking.