Zopa, the UK-based digital bank and FinTech lender, has raised £80m in Additional Tier 1 (AT1) capital to support its next phase of growth.
The funding round attracted participation from a mix of existing and new investors, with the transaction completed on the International Securities Market (ISM) of the London Stock Exchange. Jefferies acted as structuring adviser and sole lead manager on the deal, which was oversubscribed by more than two times, drawing interest from over 20 institutional investors.
Founded as a peer-to-peer lending platform, Zopa has evolved into a full-service digital bank since its launch in 2020. The company offers a range of financial products, including personal loans, credit cards, and savings accounts, and has become a significant player in the UK’s consumer finance space.
Zopa intends to use the newly secured capital to bolster its balance sheet without diluting existing shareholders. The move comes as the company prepares to enter everyday banking with the upcoming launch of its flagship current account, positioning itself to capture a broader share of customer financial needs.
The company’s strong performance in 2024 has set the stage for this latest raise. Zopa doubled its full-year pre-tax profits to £34.2m on the back of a 30.2% increase in revenue. It also expanded its strategic footprint through high-profile partnerships, including with Octopus Energy to support the UK’s £23bn renewable energy market, and with John Lewis to offer loans to the retailer’s 23 million customers.
To date, Zopa has attracted £5.5bn in deposits and has a loan book of over £3bn. With nearly 850 employees, the company is preparing to double its office space with a forthcoming move to Canary Wharf as it scales operations for its next growth phase.
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