UK peer-to-peer (P2P) lender Zopa has raised £32m in a new funding round to finance the launch of its retail banking service.
Indian financial services group Wadhawan Global Capital co-led the investment with Scandinavian tech investor Northzone.
Existing backers Arrowgrass, Augmentum Capital, Bessemer Venture Partners and Runa Capital also participated.
Zopa says the funding will be used to support its continued growth as well as the development of the infrastructure needed to support its banking ambitions.
The company plans to launch a bank to offer consumers a greater range of services such as FSCS-protected deposit accounts and peer-to-peer investment products.
It aims to prepare for the submission of a banking license application later this year.
Zopa became the first European P2P lender to make £2bn worth of loans in January and facilitated more than £800m in loans in 2016 alone.
Zopa CEO Jaidev Janardana commented: “Zopa’s vision has always been to make money simple and fair for consumers, providing our customers with better value, better service, and greater choice.
“This investment gives us additional resources to continue our growth, support the launch of our next generation bank, and bring our award-winning products to even more people in the UK.”
The round takes Zopa’s total equity funding to $112m with it previously raising £15m in January 2014.
Northzone partner Jeppe Zink said “We believe Zopa is a blueprint of what the modern, technology-first bank will, and should look like, based on transparency and customer service.
“Zopa is already a trailblazer in the market, and is in a strong position to build on this, with the launch of their new products.â€
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