Zopa's risk performance and past record for peer-to-peer lending

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Risk performance

Risk analytics are at the heart of what we do. You trust us with your money, and we don’t take that responsibility lightly.

How have Zopa’s default rates performed against expectations?

In order to meet expected returns for our investors, we’re dependent on how accurately we can predict defaults. A borrower is considered in default after missing four months’ worth of repayments. We set an expected default rate at the start of each loan and update it as the loan performs (“revised projected defaults”).

View risk data in more detail

Expected defaults compared to actual defaults (2005 to 2016)

Graph showing expected defaults compared to actual defaults (2005 to 2016)

Expected defaults:
The amount of defaults we expect over lifetime of loans when we originated them.
Actual defaults:
Total defaulted loan amounts, as a percentage of amount lent in the calendar year.
Actual defaults so far:
A large proportion of loans originated after 2014 are still outstanding therefore comparison of expected and actual lifetime default rates is less meaningful at this stage.

How have Zopa’s returns for investors performed against expectations?

We measure our returns performance partly, but critically, by comparing expected returns to actual returns. This contributes to our track record of delivering competitive returns, and also holds us to account on how returns actually perform, compared to what we expected.

Over 12 years, we have collected a wealth of information that allows us to make informed default rate predictions. This information has helped us get better at projecting expected default rates.

Expected returns compared to actual returns (2011 to 2016)

Graph showing expected returns compared to actual returns (2011 to 2016)

What happens if default rates differ from our expectations?

We use our expected lifetime default rates for loans to inform the target return for investors. We monitor this lifetime default rate very closely, and if it’s lower than expected we pass on all benefit directly to our investors. Likewise, if default rates are higher than expected then investor returns will be lower than expected.

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.

We're here to help

Since 2005, more than 76,000 investors and institutions have lent over £2.70bn with us.

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Email: contactus@zopa.com

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