Zopa: UK Peer To Peer Lending Service Comes To The US

Since I went to the microloan seminar yesterday, I wanted to tell you about online loans from Zopa.com, a peer to peer lending site. After hearing that this government sponsored microloan program was costing 12-16% interest for people with even EXCELLENT credit, I figured there had to be a better way for most “second job entrepreneurs” to get access to business start up funds. Zopa – which stands for Zone of Possible Agreement – been around for a while in the UK and they’re coming to the US. You can have them send you an email when things roll out nationwide here. Borrowers (and individuals wanting to make much better than bank returns on their money) LOVE this program.

By cutting the “fat” out of the lending system and not having to have a huge investment in real estate on every corner like a bank, Zopa provides online loans for a 0.5% fee to the borrower and takes a small “spread” between the rate paid by the borrower and the rate received by the investor whose monies are being loaned out.

The rate you pay is based on your credit rating. So if you’re and entrepreneur with a day job and need a loan to start your business, you’d be crazy not to check here about online loans.

Here’s how the rates stack up in the UK… Again, I can’t wait to see this roll out to the US. I’ve signed up for their email annoucement (on the home page) to be alerted.

I hope this will revolutionize borrowing for microbusiness start up in the US!

Here’s the scoop about Zopa in 5 sentences from their website.

1. Zopa is the marketplace where people meet to lend and borrow money
2. It’s regulated by a number of official bodies, and safety measures minimise risk for lenders
3. It’s backed by the same investors that backed eBay, Betfair and Skype
4. It was set up in March 2005 by many of the team behind Egg, the UK’s biggest online bank
5. Over 100,000 people in the UK have joined so far

“By cutting out the banks and dealing direct with Zopa lenders, all borrowers at Zopa get great rates – but the exact rate you’ll be offered depends on your creditworthiness.”