Zopa eyes bank launch after closing £60m funding round

International peer-to-peer lender Zopa has raised £60m in its largest funding round to date, as it prepares for the launch of its digital banking platform.

The banking hopeful has raked in £16m from a mix of new and existing investors and adds to the £44m raised it in a prior announcement in August.

Zopa has planned to expand its product offering with launch of a new ‘next generation bank’, which will join the flurry of challenger banks and digital banks aiming to unseat the traditional firms. The company has said it will use the new capital to fund its bank launch but has yet to set a date.

The company just achieved full year profitability last year for the first time since 2012 and has lent more than £3.7bn in unsecured personal loans in the UK since launch.

The Zopa platform users help to fund the loans, with ability to choose between two investment methods differentiated by the level of risk involved.

Investors are able to pick a risk level and the funds will then automatically be invested to matched borrowers. The monthly repayments received can either be withdrawn or a user can attempt to sell the outstanding loan to other investors on Zopa.

Zopa CEO Jaidev Janardana said, “This new funding takes us a step closer to realising our vision of being the best place for money in the UK.

“Having served half a million customers to date, Zopa is set to redefine the finance industry once again through our next generation bank to meet a broader set of UK customers’ financial needs.”

Earlier this year, Janardana said he believes the FCA’s proposed changes to P2P lending platforms is a positive step for the market.

Last year, the lender raised £32m in a funding round which was co-led by Wadhawan Global Capital and Northzone.

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