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In 2013, we introduced Safeguard: a provision fund to cover losses for our lenders during a normal economic environment. Safeguard covers investors investing in Access and Classic loans.

We fund Safeguard based on our expected lifetime default rates. We monitor the coverage of our Safeguard fund to track it’s ability to pay out when a loan defaults. We aim to have a coverage of 1.1x what we expect the fund to pay out.

Safeguard is not a guarantee on your investment. To date, all claims on Safeguard have been paid; but there’s no guarantee this will always be the case.

Total in Safeguard fund today


Current coverage


Future expected Safeguard income collected from regular borrower payments


Coverage including future income


Last updated: 9th February 2017

Loss rate and Safeguard buffer

We fund Safeguard based on our expected lifetime default rates for loans which are covered by Safeguard. In addition to our expectations we add an additional 10% buffer.

If actual defaults are lower than expected, this buffer would increase.

If actual defaults are higher than expected, then Safeguard would struggle to repay the expected interest.

Safeguard responses

Last updated: September 2016

This graph demonstrates what would happen to interest rates and how Safeguard would perform under different default rates. This data reflects the current state of Safeguard across all loans covered by the fund, investor interest rates will differ depending on their individual loan books

Fund usage and principal repaid

This table shows what’s left the Safeguard fund compared to how much we put in to cover that batch of loans. We also look at the amount that has been paid back to understand whether the fund usage is in line with what we would expect at this stage of the loan lifetime.

Actual bad debt
fund usage
2016 27% 20%
2015 68% 54%
2014 79% 78%
2013 64% 93%

Figures above only relate to A*-C Safeguarded loans

Important information

Before you go any further, remember past performance is not a reliable indicator of future results. And forecasts are not a reliable indicator of future performance.

Read more about risk information.

Our risk statement has all the details.

Zopa's public loan book showing historical performance is available for download.

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