UK-based Fintech Zopa Turns Annual Profit

Zopa, a prominent player in the fintech industry, appears to be laying the groundwork for a potential initial public offering (IPO) in London. 

Zopa began as the world's first peer-to-peer lending company in 2005, connecting investors with individuals seeking loans. Towards 2016, it began its pivot into banking to access more stable ways to fund its loans with savings accounts, and gained a full banking licence in 2020. 

While fellow fintech banks like Monzo and Revolut have primarily focused on rapid expansion through digital current accounts, Zopa has taken a different approach. 

With a customer base of one million individuals, Zopa has concentrated on diversifying its offerings to include savings accounts, credit cards, car finance, and personal loans. This strategic shift has proven fruitful, evident from the company's impressive financial performance. In 2023, Zopa reported pre-tax profits of £15.8 million, a notable turnaround from the previous year's £26 million loss.

Zopa's success can be attributed to its evolution from a peer-to-peer lending platform, founded in 2005, into a full-fledged banking institution. By embracing this transition in 2016, Zopa gained access to more stable funding sources, particularly through savings accounts. Building on this momentum, the company is poised to introduce a current account for existing customers by year-end, with plans to expand the offering to new customers in the following year. With backing from SoftBank, the fintech aims to offer current accounts to existing customers by the end of 2024. 

"2023 was a landmark year as we achieved our first full year of profitability, grew to over a million customers, and maintained our market leading net promoter score," says Jaidev Janardana, CEO at Zopa Bank.

"Across all our products, the opportunity is huge and we remain passionate about changing customers’ relationship with money for the better," he continued.

In 2023, Zopa achieved profitability, gained over a million customers, and maintained a leading net promoter score, while also lending over £6 billion and improving financial outcomes for over half a million people in the UK.

Having received considerable funding from investors, and a strengthened C-suite team, Zopa's potential IPO seems ever nearer. 

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