Zopa is joining forces with UK-based money management app Pariti.
The new partnership will offer Pariti users Zopa-powered refinancing options via an integration between the two companies. For Pariti, it’s the first of a number of planned product integrations, and the start of its journey towards becoming a “marketplace bank”. Pariti CEO Matt Ford says that Pariti's mission is to build a holistic understanding of the financial positions of its users, with the intention of then linking those users up to a range of bespoke services and products, which will in time come to span a range of financial services.
The Pariti app connects to a user’s bank accounts, assesses their spending history and helps them to set a target for improvement. The app uses partnerships with providers like Zopa to offer low cost financial products to its users. The recently authorised Pariti holds credit reference agency and credit broking permissions from the FCA.
The Zopa partnership has been forged specifically to help users consolidate credit card debt. “UK consumers are getting ripped off by credit card companies”, says Ford. “Introductory offers, confusing fees, and unsuitable products have meant that people are paying far too much to borrow, and are getting stuck in high-cost debt. The product integration with Zopa allows us to proactively help reduce their cost of borrowing and pay off debt faster.”
A Pariti survey of 3,100 credit card users found that 47 per cent fail to clear their balances each month, and that 60 per cent pay only the minimum amount. Pariti states that, with average monthly repayments of just 5 per cent of loan value, consumers would take eight years to clear a £1,700 balance on a typical 20 per cent APR credit card. There’s a clear opportunity for Zopa here, and Pariti users will be able to apply for a Zopa loan directly through the app.
The Pariti tie-up represents the latest deployment of Zopa’s partnership API, which launched in May of this year and which powers a number of integrations between the platform and consumer facing brands. The API allows other companies to “tap into” Zopa’s proprietary lending technology, risk expertise and, most crucially, funding – often at the point-of-sale.
Zopa announced a tie-up with UNSHACKLED.com – an online “one-stop shop” for mobile phones – in May, becoming the website’s first financing partner. The partnership makes 24 month loans available to consumers who choose to finance their phones rather than paying the full amount up-front. Zopa’s own Car ReFi product is also powered by the partnership API.
The partnership between Pariti and Zopa continues what is becoming something of a trend within the sector globally: platforms aligning themselves with personal finance analytics firms. Prosper’s acquisition of BillGuard and CommonBond’s acquisition of Gradible are but a few examples.
Commenting on the partnership, Zopa CEO Jaidev Janardana said: “Our own research shows that many consumers could save money by swapping out expensive credit card debt for a lower-priced Zopa loan, and by working with Pariti we are able to offer this service to even more consumers. We are very excited to be working alongside this likeminded financial disruptor to build the new generation of fairer, more transparent financial services.”
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