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Peer-to-peer investing

Zopa review

By Michael Trudeau

Article 3 of 6

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Zopa review

If you're thinking about saving or borrowing money through a peer-to-peer lending website, read our in-depth Zopa review.

 

Zopa was the UK’s first peer-to-peer lending website. It offers investment products where money is lent to UK consumers looking for personal loans. 

It recently revamped its range of products, cutting them from three to two, and removing the protection of its reserve fund altogether. Previously it would cover borrower defaults from its reserve fund, but all new investors will now be exposed to defaults. 

When you lend money through Zopa, it splits up the amount you invest into £10 chunks and spreads them across many different loans - meaning you're exposed to a very diverse tranche of borrowers rather than having all your P2P eggs in one loan basket.

Zopa peer-to-peer lender details

Lending terms

  • Minimum lend: £1,000 (up from £10 in June 2017) - however, Zopa is currently not accepting new investors
  • Maximum lend: No maximum
  • Lending term: Investors can choose from two investment products: Zopa Core, and Zopa Plus, which offer different levels of risk and return. The loans they invest in are for terms ranging from one to five years, but investors can withdraw money at any time (see below).
  • Can I withdraw funds early? Yes, but you will have to pay 1% of total amount withdrawn on most products, with the exception of Zopa Access, where there is no withdrawal fee. You can avoid the fee by simply letting your loans resolve and not re-lending as they are paid off.
  • Projected rate of return for lenders: 3.9% for Zopa Core, 6.1% for Zopa Plus (rates checked on 21 June 2017).

Borrowing terms

  • Minimum amount you can borrow: £1,000
  • Maximum amount you can borrow: £25,000
  • Borrowing term: One to five years
  • Can loans be paid off early? Yes, and without any penalty fees
Zopa peer-to-peer lending satisfaction
Feature Rating
Overall experience
Interest rates
Explanation of the risks
Default rates
Variety of products available
Ease of use of the website
Customer service
Clarity of information on the website
Online community NA
Table notes:
Star ratings out of five show levels of satisfaction for each category. "NA" means not enough responses received to assign a star rating.

What Zopa's customers say about them?

‘Easy-to-use website, easy to withdraw and invest, and good email reminders.'

‘Straightforward, and better rates than a building society. I have no cause to mistrust the system.’

‘Good interest rate paid, but absence of FSCS coverage as on other savings remains a concern.’

Click here to visit Zopa.

Alternatives to peer-to-peer websites

If you're looking for a loan, it's worth checking out Which? Best Rate personal loans, too.

In almost all cases you'll want to build up cash savings (in Isas or savings accounts) before considering putting your money into a more risky investment such as peer-to-peer lending.

If you're looking for higher returns you might want to consider other investments.

  • Last updated: July 2017
  • Updated by: Michael Trudeau
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