In something of an 11th-hour raise Zopa has secured cash to fully launch its new banking arm.
Fintech pioneer Zopa has raised its largest funding round to date, with a £140m injection from IAG Capital, to safeguard its plans to launch a full consumer bank.
The new investment will allow Zopa’s new banking platform to fulfil regulatory capital requirements, a key requirement for the lifting of restrictions on its bank licence. The investment is subject to final approvals, including "regulatory change of control," according to a media statement.
Zopa continues to hold its banking licence with restrictions and is working with the regulator to obtain its full licence.
Once approved, the investment will be provided by IAG Silverstripe, an investment arm of IAG Capital, the private investment group specialising in digital and technology-led businesses.
Jaidev Janardana, Zopa CEO, 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 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.”
To date, Zopa Limited has lent £5bn in unsecured personal loans to customers in the UK.