Leading peer-to-peer lender Zopa has started offering its new Isa to savers prepared to take some risk with their capital.
L eading peer-to-peer lender Zopa has started offering its new Isa to savers prepared to take some risk with their capital.
Zopa obtained authorisation from the Financial Conduct Authority in May, which enables it to offer Isa accounts.
“Zopa Core” will offer returns of 3.9pc after fees and expected credit losses, while “Zopa Plus” will target a higher 6.1pc return by lending to riskier borrowers.
But Zopa has said the Isa will not benefit from its once highly-promoted “safeguard” scheme, which was set up to limit investors’ exposure to bad debts. This is a reserve cash fund set up to help protect investors when those borrowing from them default on repayments.
The scheme will continue to be offered to certain other non-Isa investors up to December, after which it will no longer apply to any new lending.
Zopa said that tax laws changed in 2015 meant that investors could claim loss relief on any bad loans, “thus removing the primary reason for Safeguard”.
