Could be worse

How does that work then?

I believe that investors in P2P will get burnt but in saying that - once of the things that is said about ZOPA is that it wasn't around during the last crash.
Well it was and I lost money and I made it back and it's been an ok investment (from a % return and ROCE but not so much on a return on my time) - so I'll hold off calling 999 just for now.

Worth mentioning, however, that the default rate on some Zopa loan cohorts from 2015 onwards has exceeded that observed in the peak of early 2009. Zopa was incredibly small in 2008/09 and still had a relatively high quality borrower base. Like most P2P platforms, as it scaled up it has been forced to originate loans with lower quality borrowers. Banks have become massively more competitive in recent years at providing instant unsecured consumer loans to higher quality prime borrowers; this has crowded out P2P platforms with those types of borrowers. For example, I can currently press a button and get a 5-year unsecured loan for 50k at 2.5% from my high street bank; definately couldn't do that in 2008/09. So I'm not at all convinced that the behaviour of the Zopa loanbook of 2008/09 is in any way indicative of how it will behave in 2018/19.

I have data going back that far but sadly I only had minimal skin in the game in 2008, having started in Dec 2006 with £100 just to see what the fuss was all about. I added a further £75 towards the end of 2008 but none of that was lent out until January 2009.

As a consequence I have no defaults until 2009 when I added a further £1000 in July and by the end of 1009 I had picked up 6 defaults in 133 loans taken out in 2009. So by then defaults on 2009 loans were 4.51% and defaults of total loans to date were 3.92%.



 Sorry about the size click it and you will see better. Its not exactly showing that much for 2008 but as I say 2009 shows a start of defaults.

I too have not made any losses, I have a considerably ramp up of defaults, fortunately mostly £10 or less, but according to my XIRR for each year since Jan 2015 (The statements reports start point) I am not losing by a long way and even better than the banks have provided over the same period, current accounts that is. 

I should say though that my lending rates to Plus have never been more than 20% overall. Also the table does not include SG defaults either - there are many of those too but the losses obn those are/were nil. I should also say that these figures have been collated from Invest and the more recent ISA for both myself and Mrs Aju.

Another thing to bear in mind is that settled are not part of this data I have a number of those but they are full losses. I'm trying to find a way to include that data, I'm nearly there and if it shows up a real difference I will change the info.