P2P lender Zopa to keep bank licence after raising £140m
The firm, which plans to launch as a ‘next generation bank’, was granted a bank licence with restrictions in December 2018.
This licence would have expired within days had the firm not raised the necessary funding.
The investment comes from IAG Silverstripe, an investment arm of US-based IAG Capital Partners.
Zopa will retain its licence with restrictions, but the firm said the investment will enable it to fulfil its regulatory capital requirements, which is key for restrictions on its bank licence to be lifted.
It said it is working with the regulator to obtain its full licence.
Zopa plans to expand beyond P2P loans and launch a range of savings accounts and credit cards.
Jaidev Janardana, chief executive of Zopa, said: “This new funding means we have concluded the fundraising phase of our bank mobilisation. Definitive agreements to provide the funding have been finalised and are subject to final approvals including regulatory change of control.
“We continue to hold our bank licence with restrictions and are working closely with the regulators to gain our full licence. We are excited that once approved, Zopa will be able to launch its bank alongside its peer-to-peer business and offer a broader set of products to our customers.”