How Zopa minimises risk

We've been managing risk for over 10 years.

Zopa has some of the lowest default rates in the industry because we're very selective about who can borrow. Your money is automatically spread across multiple sensible borrowers to diversify risk

Zopa Safeguard Trust is designed to protect you from potential losses. Safeguard has a 100% track record of protecting lenders from defaults since launch and is funded from fees paid by borrowers.

What the press says

“The longest-running site, with good rates and risk spreading.”

Martin Lewis,, June 2014

Zopa's Safeguard Trust

You don't need to take any action if a borrower misses a payment. We chase them for you and if they get 4 months in arrears loan contracts are assigned to Safeguard to claim for the outstanding loan amount. Safeguard will usually pay the claim, but does reserve the right not to, and in this case seek to recover the amounts owed on your behalf.

Since Safeguard's launch all claims on loans covered have been paid, although there is no guarantee this will always be the case.

The amount of money in our Zopa Safeguard Trust is based on the estimated default rate for each borrower, and an assessment of whether there is enough money in the fund to make estimated pay-outs.

Jargon buster

when a borrower has a repayment overdue.
when a borrower can no longer afford to pay the rest of their loan.

View our historical expected and actual defaults

Reliable borrowers and low defaults

We have a 10-year track-record of delivering some of the lowest default rates in the UK personal loans market. We achieve this by only enabling loans to sensible borrowers who can afford to repay. They choose Zopa over other providers because we offer fairer rates and a better service (see borrower reviews).

Don't put all your eggs in one basket

Diversification is another important way of protecting your money. Your money is lent out in chunks as micro-loans and a maximum of 2% of your total money on offer with Zopa is lent to any one borrower.

In the unlikely event that the Zopa Safeguard Trust ran out of money, your risk of loss would be spread across many borrowers.

What the press says

“Zopa keeps its default rate low by lending to creditworthy people and breaking up investments into smaller chunks. Historical bad debt since 2010 stands at 0.21%.”

3 February 2014

Good business practice

Zopa has been operating since 2005. Zopa Limited is authorised and regulated by the Financial Conduct Authority (firm registration number 563134).

If Zopa were to go out of business, Zopa has planned for an independent organisation to take over the administration of your loans.

Zopa loanbook data can be accessed by anyone (on an anonymized basis). We maintain this transparency because we believe that being held accountable on a day-to-day basis by our customers, the industry, regulators and the media makes us a better business.

Read more about what we've done to mitigate operational risks

To date, we've helped lend £1.09bn, earning our lenders £62m in interest

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