Zopa Open-Banking Initiative on Track
FACTS
- The P2P lending platform Zopa was granted a banking licence in the end of 2018. They now intend to take their strategy one step further based on Open-Banking derived possibilities: a strategy they already started looking into.
- In February 2018, Zopa launched their first Open-Banking feature for borrowers. Through connecting via their partner TrueLayer, Zopa customers can authorise lenders to verify their revenue directly from their e-banking portal.
- Zopa is also working on two additional Open-Banking-related features:
- For borrowers: connect multiple bank accounts to Zopa’s mobile app. This service is currently being tested.
- For investors: manage diverse portfolios from a single portal, connect several virtual account to Zopa’s interface.
“Over half of people who need to verify their income to take out a loan with us choose to do so by connecting their bank account, and allowing us to access their transaction information automatically”
CHALLENGES
- From P2P lending to banking services. Zopa has been granted a banking licence in the UK end-2018. They aim to launch their e-banking business, in addition to their existing P2P lending platform. They also consider launching three products: a term savings account, a credit card and a PFM app.
- In this context, their open-banking approach should streamline lending procedures as well as banking processes. Their partnership with TrueLayer will allow them to add aggregation features, the like of which are relevant to a PFM app.
MARKET PERSPECTIVE
- According to PwC, the open-banking market could be worth £7.2 billion in the UK by 2022.
- Other industry players have been looking into similar services, e.g.: the P2P lending platform Lending Works with Credit Kudos.
- Yet another example, Younited Credit, opted for Linxo to make it easier to retrieve customer data. This service has been adopted by 75% of their customers in Spain, and by 35% in France right after the test phase.