7 March 2007
A fast-growing social lending network which specialises in providing low-rate small personal loans is celebrating its second anniversary this week.
Offering consumers the chance to either make a small amount of capital by lending out their cash, as well as providing those looking for a small loan with a cheaper alternative to a bank loan, Zopa has proved incredibly popular.
Research conducted last year by the Social Futures Observatory found that 74% of Britons would consider either borrowing or lending money through an online Social Lending community like Zopa, rather than use their high street bank.
Essentially by cutting out the middle man - the banker - consumers are able to obtain a lower rate personal loan and as each transaction is limited to a maximum of £500, it can prove the ideal solution for someone who is only looking to borrow a small amount.
James Alexander, Cofounder and Chief Executive Officer of Zopa in the UK, said that Zopa's members proved that social lending works and that it is often just the "breath of fresh air"they've been looking for in dealing with their personal finances.
"Borrowers and lenders are getting a better deal than they can get elsewhere and they enjoy a level of transparency and value for money that's rare in personal finance. Risk has been successfully kept to an absolute minimum, reflected in our default rate of just 0.2%," he added.
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