Predictions for 2013
- Peer-to-peer lending will arrange £¼billion
in new loans
- Funding Circle to overtake Zopa by active loans
- More providers will enter the market, with the
possibility that one will be a well known brand
- At least one existing provider will exit the
- Peer-to-peer lending will get far greater press
Peer-to-peer lending will arrange £¼billion in new loans
A quarter of a billion pounds is a lot of money,
but at the current rate of growth £250million of new
peer-to-peer loans should be arranged in 2013.
This was realised in August as the rate of growth
in this sector continues to rise. By then end
of 2013 £½billion of new loans were arranged.
2. Funding Circle to overtake Zopa by active loans
Zopa started the concept of peer-to-peer lending
in 2005 and Funding Circle became the fourth UK P2P
company to launch in 2010, but by the end of 2013 it
could overtake Zopa as the company that have the greatest
value of active loans.
This was always going to be an optimistic prediction,
but certainly possible given the growth rate of Funding
Circle within 2012. However in 2013 Zopa launched
their Safeguard product which has accelerated their
growth and maintained a distance between themselves
and Funding Circle by outstanding loans.
More providers will enter the market, with the possibility
that one will be a well known brand
Last year there were no less than seven new entrants
to this market, which was more than double that of 2011.
None of these new entrants have yet threatened the position
of the top four, so this market is proving a difficult
one to crack.
There has been a doubling of new entrants into
this market with no less than seventeen companies launching
within this sector. Some of these new companies
are growing at a huge rate and may break into the top
four within the next year. While there has not
been a household name entering this space there was
talk of Santander being in discussions with Funding
Circle, and Nicola Horlick launched the Money&Co.
brand and the company itself will launch in 2014.
At least one existing provider will exit the market
Last year there were two companies that failed and
there are others that are struggling to attract borrowers
or lenders, so it is highly likely one of more of these
No companies have formally announced their withdrawal
from the sector, but two companies have failed to make
any significant number of loans within 2013 and their
loan books are decreasing.
Peer-to-peer lending will get far greater press coverage
This is difficult to measure, but we would expect
more TV, broadsheet and tabloid coverage.
There has been a lot of press coverage on peer-to-peer
lending, and the FCA published a consultation paper
on crowdfunding - including peer-to-peer lending - where
the P2P money website also provided some inputs.
This paper attracted a lot of media coverage and there
was a recent speech within the house of commons on this