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Peer-to-peer lending sector more than doubled in 2013

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The UK's peer-to-peer lending sector (P2P) increased by 121% during 2013, new data shows.

According to the Peer to Peer Finance Association (P2PFA), the industry trade body, cumulative lending at the end of quarter four 2013 hit £843m compared to £381m at the end of 2012.

At the end of last year, there were over 3,700 business borrowers, 70,000 consumer borrowers as well as more than 86,000 active lenders.

Christine Farnish, chair of the Peer-to-Peer Finance Association said: “More and more people now recognise the benefits that P2P lending can offer. No wonder the sector is growing so fast.

“2014 will be a significant year for the industry. We are about to pass the £1bn milestone of total monies lent and in April we become regulated by the Financial Conduct Authority, something we strongly support”. 

Peer-to-Peer lending first began in 2005 when Zopa launched in the UK.

Peer-to-peer allows businesses and consumers to lend to each other, generally offering lenders more attractive interest rates than traditional bank savings account while offering borrowers competitive loans.

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