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Zopa
Zopa
| Grade |
Term |
Annual
Bad Debt |
Lifetime
Bad Debt |
| Predicted |
Predicted |
Actual |
| A* |
24 |
0.5% |
0.52% |
0.00% |
| A* |
36 |
0.5% |
0.80% |
0.13% |
| A* |
48 |
0.4% |
0.82% |
0.03% |
| A* |
60 |
0.4% |
1.00% |
0.21% |
| A |
24 |
1.0% |
1.04% |
0.00% |
| A |
36 |
1.0% |
1.60% |
0.49% |
| A |
48 |
0.8% |
1.63% |
0.00% |
| A |
60 |
0.8% |
2.00% |
0.91% |
| B |
24 |
2.9% |
3.02% |
0.06% |
| B |
36 |
2.9% |
4.53% |
1.01% |
| B |
48 |
2.3% |
4.70% |
0.00% |
| B |
60 |
2.3% |
5.96% |
2.69% |
| S |
24 |
TBD |
TBD |
TBD |
| S |
36 |
3.0% |
4.56% |
0.00% |
| S |
48 |
TBD |
TBD |
TBD |
| S |
60 |
TBD |
TBD |
TBD |
| The markets below
are no longer available |
| A* 1 |
12 |
0.5% |
0.3% |
0.00%
3 |
| A* 2 |
12 |
0.5% |
0.27% |
0.00%
3 |
| A* |
24 |
0.5% |
0.5% |
0.00%
3 |
| A* |
48 |
0.5% |
0.5% |
0.00%
3 |
| A |
6 |
0.5% |
0.1% |
0.00%
3 |
| A 1 |
12 |
1.4% |
0.8% |
0.02%
3 |
| A 2 |
12 |
1.0% |
0.54% |
0.00%
3 |
| A |
24 |
1.0% |
1.0% |
0.09%
3 |
| A |
48 |
0.9% |
1.8% |
0.00% |
| B |
6 |
1.0% |
0.3% |
0.00%
3 |
| B 1 |
12 |
2.8% |
1.5% |
0.03%
3 |
| B 2 |
12 |
2.9% |
1.55% |
0.00%
3 |
| B |
24 |
2.4% |
2.5% |
0.25% |
| B |
48 |
1.7% |
3.5% |
1.39%
3 |
| C |
12 |
5.6% |
3.0% |
0.00%
3 |
| C
1 |
24 |
4.8% |
5.0% |
0.72%
3 |
| C
2 |
24 |
5.2% |
5.42% |
0.00% |
| C |
36 |
5.2% |
8.20% |
3.77% |
| C
1 |
48 |
3.4% |
7.0% |
10.94% |
| C
2 |
48 |
4.2% |
8.58% |
0.00% |
| C |
60 |
4.2% |
11.00% |
6.38% |
| Y |
24 |
5.0% |
5.21% |
2.53% |
| Y |
36 |
5.0% |
7.89% |
2.03% |
| Y |
48 |
3.1% |
7.99% |
0.00% |
| Y |
60 |
3.1% |
8.08% |
3.92% |
| The listings below
are no longer available |
| L |
12 |
N/A |
N/A |
3.86% |
| L |
24 |
N/A |
N/A |
2.59% |
| L |
36 |
N/A |
N/A |
5.69% |
| L |
48 |
N/A |
N/A |
15.83% |
| L |
60 |
N/A |
N/A |
10.51% |
Data valid as of 15th
September 20131
Original market
2 Second introduction
3 No longer published by Zopa
|
 Zopa
was the first peer-to-peer company, founded in 2005,
and since then it has started a global industry.
Zopa is also a founder member of the P2P Finance
Association.
Zopa's model allows lenders place their money
on the Zopa market and this will be automatically
split between a large number of borrowers.
Lenders can set their interest rates for each risk
grade which has different expected bad debts.
While originally offering loans between 6 and 60
months, Zopa now focus on 24, 36, 48 and 60 month
loans only.
Zopa now has approximately 2% of the personal
loan market in the UK and currently dwarfs most
of the other
UK P2P companies.
Average lending rates after tax are now comparable
with the best savings bonds, due to the effect of
bad debt and taxation of bad debt, however for non-taxpayers
and those lending at the top of the market there
are still some good interest rates available.
Unique selling point
Zopa's market model allows automatic lending
with a high level of diversification, and it has
a good track record on bad debt, as you can see
in the chart to the right. Due to the size
of the market there is a high level of liquidity
and allowing borrowers to access low rates instantaneously.
 Competition
Zopa has 85% of the peer-to-peer market, so dwarfs
all of the other companies combined. Zopa
is also competing with high street banks, building
societies and personal loan companies.
Comments
The web site
is professional and communication has been very
good. Loan rates on Zopa have fallen recently
as Zopa appear to be tweaking the
borrower fee daily to ensure the rates remain
competitive.
There was a larger than predicted bad debt
from loans originating in 2008, but since then
Zopa have tightened lending criteria, and are
now overestimating bad debts for most markets.
In summary Zopa has been innovative, offering
excellent rates to borrowers and good rates to lenders.
The P2P money website recommends Zopa as the number
one provider for personal loans.
Zopa review written
by
Ian Gurney, last updated on 24th
September 2013
|
