ZOPA has sold a batch of bad loans to a debt recovery company to ensure lenders are repaid.
It is the second time the peer-to-peer lender has used this route to ensure lenders are repaid when loans have defaulted.
The platform declined to comment on the value or number of loans but said it was not making any profit from the sale and investors should be repaid over the coming days.
Read more: Zopa invites customers to test new savings product
“We’ve sold a batch of loans to an FCA-regulated debt purchasing firm, enabling us to provide our investors with a faster – and likely higher – recovery on some of their loans,” a spokesman for Zopa said.
“We’re working with one on the UK’s top debt purchasing firms and it shares our values of treating customers fairly and compassionately while working towards the best possible repayment outcome.
“Zopa is not making any additional revenue from the sale. Investors whose loans were involved in the debt sale, should see the money in their account and their monthly statements over the next week.”
The platform made a similar sale in November 2018.
Zopa’s most recent analysis of its loanbook as of April 2019 anticipates 3.77 per cent of its loans made this year will default.
Its default projections for between 2015 and 2018 have all been revised upwards although the actual figures remain below expectation.
Read more: Zopa maintains credit policy as it revises default expectations