Zopa Review
Return Rate 3
Overall Safety 3
Asset Security 1
Time in Business 5
Lazy Investor Rating 4

Easy 5.2% Annual Returns Available Investing With The World’s Oldest Peer to Peer Lender. Zopa Review

Summary 3.2 good

Zopa Review

Last Updated on 21st November 2020 by Mark

5.2% Annual Returns Available Investing With The World’s Oldest Peer to Peer Lender! Zopa Loans & ISA Review

My Lending Experiences & Actual Investment Returns Published Monthly.


What is Zopa?

Zopa is the oldest and one of the largest Peer to Peer lenders in the world. 

Providing personal loans to consumers around the UK, Zopa offer their investors the option to invest with one of the most experienced lenders in the world.

Zopa offers targeted returns of 3.5% – 5.2% on mostly unsecured personal loans for terms from 1 to 5 years through their auto-invest portfolios. They also offer a retirement account (Zopa ISA) for potential tax free investing. 


My Experience With Zopa…..

I exited Zopa over a year ago and I’m happy I did. Unsecured loans with no provision fund is a recipe for disaster in this environment in my opinion. Zopa is a large concern, and they are the oldest Peer to Peer lender in the world. It still doesn’t give me any confidence that in a steep economical downturn they can survive unsecured lending. Time will tell of course, but I prefer asset secured lending in this environment with companies like Kuflink, Loanpad or CrowdProperty when defaults happen I have something to sell and get my money back.



The Obvious Investor – Easy-Info Table© – Zopa Review

Overall Rating*:3 out of 5 stars (3 / 5)
Who can invest:
Loan Currencies:£  
Estimated Return:4.5% to 5.2% - changes daily.
My Actual Return
(Per Lender):
My Calculated XIRR:N/A
Risk Rating*:4/10 - Low - Med    4 out of 10 stars
Early Exit:Yes.
1% fee plus possible difference in rates.
Min. Investment:£1000
Deposit Funds:UK bank account 1-24 hours.
Manual Invest:No.
Lending To:Borrowers
Loan Types:Consumer personal loans.
Default Rates:Around 3% from an expected 4.52%
Loans Amortize:Yes
Loan Security:No.
Provision Fund:No.
Time to Invest:Medium.
Huge loan book but can still take several days.
Time to Mange:None (auto-invest)
Lender Fees:Only on early exit.
Payments Received:Monthly. Various times.
Amount Lent:£3 billion+
Number of Investors:80,000+
Loan/Dflt Stats:Click Here for Stats
Regulated:Yes: FCA
Location:London, UK   
Email:[email protected]
Telephone:020 7291 8331 (UK)
Cashback**:Yes! £50 cashback for a £2,000 investment
Learn More >>
How to Sign Up**:Sign Up Here!




Zopa Review – Overview


Zopa were launched in 2005 in the UK. In the 14 or so years they have been in business, they have lent in excess of £3 billion from almost 80,000 active investors.

In January 2017, Zopa became the first UK based peer-to-peer lending company to lend more than £2 billion worth of loans.

Zopa’s management team originally started off in banking (Egg Internet Banking), and then helped start the P2P lending revolution leading Zopa to become one of the biggest P2P Lenders in the world.

However now it appears they are trying to be a bank again. In fact, Zopa are spinning off part of their business to create “Challanger Bank” in the UK due to open in 2019. 


Regulation – Zopa Review

Zopa are regulated by the UK’s Financial Conduct Authority (FCA) with full permissions under FCA number 718925. 

They gained FCA permissions in May, 2017.

It’s important to note that the FCA is not the same as the FSCS (Financial Services Compensation Scheme), so capital is not protected as it would be in a bank.

Zopa FCA Screenshot - Zopa Review


Signup Process

Opening an account with Zopa is fairly easy. Just the usual ID & anti money-laundering checks.

If they can verify you though one of the UK’s credit agencies, you will be approved immediately. If not, you may need to send them a copy of your passport or driving license, and a utility bill or bank statement.

UK Residents with a UK address and bank account can invest with Zopa.

Zopa Signup Screenshot - Zopa Loans Review



Deposits & Withdrawals – Zopa Review

Deposits and withdrawals are made by bank transfer from a UK bank.

Bank deposits usually show up in your account the same or next working day. 

Withdrawals are only to a verified bank account and typically take 2 – 3- business  days.

My Zopa Deposit Screenshot - Zopa Loans Review



Time to Become Invested – Zopa Review

Even though Zopa has a huge loan book, it can take a few days, to a couple of weeks to get funds completely invested.

Zopa loans are in heavy demand so there can be a lot of money in the queue before you.

Zopa do not pay interest on uninvested funds unfortunately, so you won’t get a return while funds are not invested.

It’s always easy to see if capital is invested or not. When it is “Matching to Borrowers” it is not yet invested.

Zopa Core Account - Zopa Review



Who are we lending to?

Zopa is a true Peer to Peer Lending platform.

Loan agreements are directly between the lender and the borrower. Zopa just acts as a middle man, managing loans, payments and debt collection etc.


Zopa provides loans to consumers for personal loans, debt consolidation, car finance, home improvement, wedding loans and holiday loans among others for terms of up to 5 years.

Zopa Loan Application - Zopa Loans Review


Loan Security

Zopa loans are mostly unsecured personal loans to credit-worthy borrowers.


Default Rates – Zopa Review

Zopa’s actual default rates as of this review sit at around 3% from an expected 4.52% in 2017 (figures below are not yet complete for 2018).

You can always see up-to-date statistics on Zopa’s website statistics page.

Zopa Default Rates - Zopa Loans Review




Generally Zopa personal loans all amortize. 

Amortization is the paying off of debt with a fixed repayment schedule in regular installments over time. It reduces the risk of the loan compared to a non-amortizing loan in which nothing is received until the end of the loan period, or only interest is received monthly, and then the capital repaid at the end of the loan period.


If you list the loans that your capital is invested in on the Zopa website, you can see that a list of loans, and capital that has been repaid.

Zopa Loan List - Zopa Review


Selling Loans and Withdrawing Capital – Zopa Review

Zopa charges an exit fee for withdrawing capital early.

It is 1% of the amount, plus any difference between current rates, and the rates your loans are at.

It can take anywhere from a few minutes to a few days to sell loans and withdraw capital in normal market conditions.

Zopa Sell Loans 1 - Zopa Review

Zopa Sell Loans - Zopa Loans Review


Diversification – Zopa Review

Diversifying loans is something Zopa does automatically.

Because of the way their platform works, diversification is all done in the background.

Zopa’s website has lots of interesting information on loan diversification and distribution.

Although it is interesting, it is not really of any use as their auto-invest portfolios do everything behind the scenes.

Zopa Diversification - Zopa ReviewZopa Diversification 2 - Zopa Loans Review

Zopa Diversification - Zopa Loans Rreview


Provision Fund

Zopa used to have a provision fund called “Safegaurd”.

Unfortunately they no longer provide loans which are covered by this fund, so now we rely on diversification and Zopa’s experience to deliver their promised interest rates.


Tax Free Innovative Finance ISA (IFISA)

Zopa offers a tax free account (Zopa ISA) which was launched in January 2017 for UK residents.

The Zopa ISA can be easily opened from the main dashboard screen.

Zopa Main Dashboard Screenshot - Zopa Review


Then just choose which product you want to be part of your Zopa ISA.

Zopa ISA Screenshot - Zopa Loans Review




Zopa Accounts Review

Zopa offer two investment portfolios in their standard (non Zopa ISA) account:

Zopa Summary Page - Zopa Loans Review



What Returns Can I Expect from Zopa?

They are matching loans at returns of 4.5% in their Core portfolio and 5.2% in their Plus portfolio.

Zopa’s Core Account is made up of the higher rated lenders (from A*-C Risk Markets they quote). 

The Plus Account is a little more risky lending to their A*-E Risk Markets.

The interest rates don’t seem that much greater for the extra risk to me so I just kept my money in core when I invested with Zopa.

The Zopa ISA retirement account has the same rates available. Read more about ISA’s here.


Website – Zopa Review

The Zopa website also has some handy pages which show how loans are distributed and when repayments are due.

Zopa Statistics Page - Zopa Review

Summary – Zopa Review

Overall I think Zopa is a good option for investors who want to diversify with a well established company, although return rates are low for the risk.  Zopa does have a successful lending history and low default rates, and let’s face it, 5.2% is better than you’re going to get out of any bank right now. 

I like Zopa, however in December 2018 I decided to exit their portfolios for the most part and move the investment capital to other lenders. Not because Zopa is a bad investment, I still believe Zopa is a viable investment with a well established lender if you need them for diversification. However with rates so low now on unsecured loans, with no provision fund, I think there are safer lenders out there which pay batter returns for the risk, such as Loanpad and Kuflink to name but a few. 

I may come back to Zopa at a later date if their rates improve significantly, or if they re-implement a provision fund to guarantee returns. Currently Zopa’s rates are just “target rates” so there is no guarantee that you’ll get the rates they are targeting. The other lenders mentioned above do have provision funds, so their rates are more likely to be realistic. And all of their rates are higher than Zopa.


Thumbs Up Points for Zopa

Thumbs Up

  • Safety – large company with good history of providing loans to consumers and was able to weather the 2008 financial crisis and come out of it relativity unscathed.

  • Auto-Invest –very easy to invest with, and hands off investing once set up and reinvestment enabled.

  • Fast Investment time – investment is typically quite fast as Zopa has a huge loan book. Large sums can be gobbled up quite quickly minimizing cash drag, dependent upon their loan book.

  • Website – very easy to use and understand. Many statistics available to see where your money is invested.

  • Diversification – capital is invested over many loans, in fact Zopa try not to put more than £10 of an investors portfolio in to any single loan, so they abide by the “Prime Directive” very well. This of course would be dependent on the size of investment account as wall as Zopa’s loan book at the time of investment.

  • Low minimum investment – £1000 to start. If your portfolio is still small, it’s still easy to invest with Zopa

  • Financial Conduct Authority(FCA) Regulated.

  • IFISA Tax Free Account – Zopa ISA available for UK investors.



Thumbs Down Points for Zopa

Thumbs Down

  • No Provision Fund – if default rates rise on unsecured loans, it could throw off the projected return rate very quickly.

  • Lower Returns – Zopa offers lower returns than many competitors. Loans are still unsecured with no provision fund.

  • Exit Fee – Zopa charge a 1% exit fee plus any difference in interest rates for both accounts if you need to withdraw your money early.

  • No Quick Access Account – depending on demand, you could have to wait a while to withdraw funds early.


Risk Factor – 4/10 – Low – Medium

4 out of 10 stars

Zopa TrustPilot Rating

Is Zopa safe? I consider Zopa to be at the lower to medium end of the risk scale.

Taking in to consideration that all loans are unsecured, and there is no Provision Fund, if Zopa were a new lender I would be very cautions.

Zopa have been around for a while though and have a wealth of experience qualifying borrowers and even weathered the worst financial crisis in modern history.

Even after 14 years in business; they still get excellent ratings on TrustPilot from their customers.



Who Can Invest with Zopa?

U.K resident investors with a U.K.  bank account and a U.K. address and phone number can invest with Zopa.

Only U.K. investors can invest in the Zopa ISA. Contact Zopa for further information.


Offers & Signup Links**


New Customers receive £50 cashback when they join Zopa and invest £2000 or more by using links here on obviousInvestor.com

Click here to qualify for the £50 Zopa cashback offer >>

Signup for standard account >>

Open a ISA account >>



Similar Lenders to Zopa but with safer, asset secured loans or provision funds (most with better return rates):

Loanpad,  Kuflink, Assetz Capital, CrowdProperty



Zopa Promo Video – How Investing at Zopa Works




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* My opinions, reviews, star ratings and risk ratings are based on my personal investing experience with the company being reviewed. These ratings are personal opinions and are subjective. You should do your own research before investing any capital and not base investments solely on the opinions published on this site. 

**  Some of the links on this website are affiliate referral links. When you click on these links, I can sometimes receive a commission, at absolutely no cost to you. This helps me to continue to offer new reviews and monthly portfolio updates here on my website. I don’t receive commissions from all lenders and it has no effect on my ongoing opinions on lenders. Income on my investments and capital preservation are my main motivations.

Platforms reviewed on this website I am currently investing with, or I have invested with in the past. You can see with full transparency on my Lending Returns page which lenders I am invested with (or have previously been invested with) at any point in time. I am not paid a fee by any of the companies to write reviews, so the reviews are unbiased and purely based on my own personal experiences.

Please read my full website Disclaimer before making investment decisions.


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