Contingency, if the worst should happen
Our business is robust, but we plan for all eventualities. That means we make sure your loans would be taken care of even if Zopa were to stop doing business. If that were to happen:
When you own a loan you have the right to receive the borrower’s repayments. This remains the case even if we decide we're no longer able to operate the Zopa platform. If this were to happen, our Wind-Down Plan (WDP) would come into effect to ensure an efficient and orderly wind-down of our business with minimal impact to our customers.
If we invoke our Wind-Down Plan, we may carry out one of the following strategies:
Our affiliate, Zopa Bank already provides important services to us to help us administer our business and we would expect to continue with this servicing arrangement. This means Zopa Bank will continue to administer your loans until they are paid back or otherwise ended. Zopa Bank is regulated by both the Prudential Regulation Authority and Financial Conduct Authority and has the appropriate permissions to continue to administer your investments and collect borrowers’ repayments on your behalf.
Transfer our entire platform to another business. If this were to happen, the buyer of the platform would also be regulated by the Financial Conduct Authority, so you’d still receive the same regulatory protections you do today.
Sell your loans to another company (which may not operate as a peer-to-peer platform) and transfer the proceeds to you. We may sell your loans for less than face value. But, if we decide to do this, we’ll notify you of our decision 30 days in advance of the proposed sale and you’ll be able to opt out of the sale and retain your loans.
We review these arrangements regularly to ensure they’re up-to-date and still fit for purpose.
In line with Financial Conduct Authority rules, any money you have with Zopa that is waiting to be matched with loans or in your holding account is ringfenced in a separate client money account and not mixed with Zopa’s own funds. If Zopa were to wind down, we would return this money to you as early as possible. If a third party were engaged to manage the wind-down, they would continue to ringfence your money in a client money account.
It’s important to reiterate that this applies to cash held within your Zopa account, and not any money that borrowers still have to repay you. These loans would continue to be managed according to one of the arrangements mentioned above, which means that it could take up to five years – the maximum term for a Zopa loan – to receive your invested balance, plus interest, back.