Zopa is considering the direction of its peer-to-peer lending operations.
The world’s oldest P2P lender revealed in its 2020 annual accounts that the board was considering the “strategic direction” of the platform as it said future growth will be driven by on-balance sheet lending.
It comes after Zopa secured a full license to launch its bank last year.
The accounts, representing the 12 months to December 31, 2020, showed £633m of new loans were made through the P2P platform last year, of which Zopa Bank funded £456m.
The origination level on the Zopa P2P lending platform rose from £1.1 billion in 2019, which Zopa said reflected the tightening of its credit policy and underwriting criteria, according to reports. documents filed with Companies House.
The P2P lending platform continued to issue loans, but was closed to new investors earlier this year so it could focus on existing users funding new financing.
There is currently a waiting list to register.
Zopa said it was still maintaining its P2P lending track record in 2020, with average returns of 4% in its Core product and 5.1% for Zopa Plus, according to filings at Companies House.
Annual accounts also showed that Zopa Bank’s credit card saw over £5million in transactions in 2020 and over 10,000 customers opened its savings accounts with £117.8million worth of deposits.
Zopa Group’s revenue – encompassing both the P2P platform and digital banking – fell from £47m in 2019 to £29.8m.
This was blamed on the pandemic and also the scrapping of up-front loan fees, which reduced fee and commission income from £46m to £23m.
The group recorded a loss for the year of £41.7m – bigger than the £15.3m loss in 2019 – attributed to the costs of building its banking brand and the impact of IFRS9 accounting standards which take into account estimated losses on loans.
Zopa said it regularly reviews the position of all areas of its business.
“The past two years have presented several challenges for the P2P industry,” Zopa said in a statement emailed to News Peer2Peer Finance.
“Despite the headwinds of the Covid pandemic, Zopa continued to serve its retail investors, including offering its secondary market put options throughout the crisis.
“A leader in its field with over 16 years of strong loan performance, Zopa continues to consistently deliver positive returns to its clients.
“As with all areas of our business, we make sure to regularly monitor the broader ecosystem to refine our future strategy.”
Its customers have also reported problems accessing their accounts and making payments following a website update last week.
The platform said most services should now be accessible and any fees applied as a result of the outage will be refunded.