Zopa Community facility removed

Pity, because the ZOPA forum was one of very few that could give this indie forum a  run for it's money in terms of activity and useful user comment. (Bit thin in ZOPA comment IIRC though). It was getting a bit negative ever since ZOPA threw out all the user controls, and went for the banking model, though.

Hmmm, this suggests a P2P hiding its head in the sand. Downplaying the forum -- which was a source of good ideas, feedback, etc. till recently -- and wanting effectively to become an organization that is seen as a savings account, utterly negates the P2P culture which Zopa established and nurtured for so many years. New lenders and borrowers will simply not see the forum, and so won't have the same sense of participation. An active forum is a good way for a business to get real-world feedback on their products, so long as it is prepared to field and address the inevitable criticisms. Businesses downplay or ignore their forums when the company direction begins to move against consumer sentiment, and this is a big red warning sign in my opinion. I'm probably exaggerating, but if I were Zopa staff, I would take heed.

(A parallel criticism I had of RateSetter from the outset was its lack of a forum, since this forum did not exist at that point. It was one of the reasons I saw RS as corporate, standoffish and aloof, together with the complete lack of information about borrowers. A sign of RS's taking the lead from ZP is the fact that they usually have an active presence on this forum, summer holidays notwithstanding, although they also have a tendency not to answer "difficult" or embarrassing questions.)

There's quite a few warning signs at the moment.

1) Over the past 3 weeks Zopa has lent LESS than last year (£14.7m versus £14.78m). It was less than a year ago that the CEO was boasting of 90%+ growth rates. Now this has disappeared even though quote activity is still up by 51% over the same 3 week period. That looks like more cost per loan to me.

2) Funds On Offer is now down to only £0.6m, a third of what Ratesetter has on offer in just its 5 year market.

3) The start of August repayment run only added a little over £2m, the lowest for some time suggesting a growing number of people are moving funds when they come in. I wonder where Ratesetters boost in funding came from? And that early month boost in available funding has been exhausted in only 4 working days. Can Zopa afford another incentive to bring in more funding or will it become solely a hedge-fund plaything?

4) Ratesetter are clearly becoming dominant over Zopa. In the last 30 days RS lent out £26.4m whilst Zopa have managed just £19.6m, and with Zopas growth going into reverse this performance gap will only widen.

For disclosure purposes I cashed in my entire Zopa portfolio over the weekend.

No, and still not for me.  Perhaps they've been struck down by the same problem ebay had for most of the day.

It's back on-line now.  Nobody seems to have missed it

I cannot advise on this, not having absolute knowledge of their finances.

But, I am not taking a 1% hit to pull money out. 

There is a cycle at work. For a long time they had things all their own way, but the financial crash and the arrival of the RS provision fund have left them reacting to the market, not leading it.

Zopa will not be going out of business but we could be surprised by their next development, which may well involve more institutional funds or explicit links with another organisation.

P2P also needs a successful Zopa if it is to grow to critical mass against the banks.

What I would MOST like to see would be a sister business aimed at business lending with the following features

1) Ratesetter style lumps per business, user setting £100, £200 etc.

2) Ratesetter style provision fund, the businesses would pay fees according to risk

3) Ratesetter style market rate setting

 ie business lending with the businesses staying anonymous and invisible - less hassle dealing with Q & A's, the privacy of a Bank.

And if Zopa does not try it, perhaps someone else will.

I'd prefer to leave this thread for Zopa, so this will be my only comment here.

What is the "Risk Profile" is a open question, where to start. However I would say we have the largest Provision Fund with the greatest coverage of expected losses and relative smallest outstanding balance denominator (if you can find this data on other sites, good luck).

We also have a Provision Fund brochure that tries to explain ( www.ratesetter.com/pages/provision_fund_brochure.html ) and a FundNet score of 1 indicating a volatility measure close to cash.

RateSetter is also profitable, a member of the P2PFA, and therefore has capital in place for portfolio wind-down in rare event of failure.

So I'd say we are rock solid safe. But I would say that (and some Zopa hardliners have internet trolled me as worse than a used car salesman) so take what I say with a mega pinch of salt.