The peer-to-peer lending industry lent almost £1.3 billion last year, according to figures released today by the Peer-to-Peer Finance Association (P2PFA).

The sector has now lent more than £2.1 billion in total, doubling in size since the end of 2013.

The figures also show a growth in users of peer-to-peer lending. While the number of lenders increased by a third, the number of borrowers has almost doubled (an increase of nearly 90 per cent).

“These figures demonstrate the growing impact peer-to-peer lending is having on the market,” Christine Farnish, chair of the P2PFA, said. “Last year showed continued and solid growth in the consumer market and a significant increase in lending flow to businesses. Peer-to-peer finance within the property market is also growing.”

“2015 will be another important year. The Government has agreed that peer-to-peer lending should become part of the ISA tax-wrapper, a decision we warmly welcome. Our view is that Government should establish a new ‘Lending ISA’ category to enable consumers to understand the difference between peer-to-peer lending, cash savings and stocks and shares investments.”

Reaction to the figures has been generally positive. “P2P lending is in a rapid growth phase driven in large part by the derisory rates of interest available on cash,” Danny Cox CFP, of Hargreaves Lansdown, said. Cox noted that P2P lending remains “a relatively immature market”, but recognised that “hitting the £1 billion lent is an important milestone”. He offered a tepid welcome to the P2PFA’s proposal for a P2P ISA, declaring it was “not perfect”, but a solution that “makes a lot of sense”.

For more information on this topic, please visit ‘Peer-to-peer NISAs: Your questions answered‘.