Quite a few Peer to Peer Lending sites have cropped up in the UK in the past couple of years examples being: The Funding Circle, Rate Setter, Crowd Cube etc. The yield of return from investing ones money in such sites seems to be advertised at around the 8 % figure. Has anyone used such sites in the UK & have you found the rate of return to be on par with what was advertised. I would assume this is becoming a popular route of borrowing (and lending) money in the UK, as it is becoming increasingly difficult to do so with banks.

Would you use such sites in the future, or invest your money elsewhere ?

  • I guess there is not many people from the UK here !
    – Simon
    Mar 2, 2013 at 13:29
  • 'Fraid not :-( However, this topic isn't UK-specific, so you may want to open it up to cover any country. Mar 4, 2013 at 11:08
  • @SteveMelnikoff I understand what you are saying, but it would make more sense to me, if a UK person were to answer. I have seen other questions on here regarding P2P lending. I'll just leave it and hopefully one day, it might happen...thanks
    – Simon
    Mar 4, 2013 at 11:34

1 Answer 1


I am a (small time!) Zopa user in the UK and have been for over a year. The rates that loans are accepted at on Zopa seem to me to be 0.5-1% higher than the best deals in the commercial market. The rates did used to be up at 8% even for A* short term, but now that bracket is getting about 5.5%. That's just talking about the rate offered to borrowers. My own return will be lower as there is a fee levied from Zopa (naturally) and there is the risk of default. In 13 months on the site with ~20 borrowers and ~200 payments I have not had any defaults.

The total interest returned for 13 months on a staggered investment of £150 with all repayments re-loaned out has been £9.33. So maybe 5.7% return? I expect that to go down a bit as I'm now loaning out at lower rates.

Bear in mind also that interest from P2P lending is taxable income.

  • Thx for the response, hopefully there will be more UK users to this site in the near future. I think Zopa is one of the original P2P lending sites in the UK, not sure how popular is compared to the rest - but worth bearing in mind.
    – Simon
    Apr 4, 2013 at 12:54
  • Hi Josh, welcome to Money.StackExchange.com! Good first answer. Please read the About and the FAQ when you get a chance.
    – C. Ross
    Apr 4, 2013 at 12:57
  • It's also worth mentioning that you cannot deduct the losses you make from people defaulting from your tax bill, so it can be a risky investment. RateSetter (and probably others) give you a full breakdown of how much you need to declare on your tax bill each year. Mar 1, 2014 at 23:36

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