We’re were pleased that some of you came along to see the debut of the film back then, but now everyone can see it in the comfort of their own home as it’ll be aired on More4 on Friday 10th July at 11.10pm.

I’m not sure that our member, Adilowes who’s in the film as a case study, knew it would lead to his national TV debut! Fame at last, eh?

Let us know what you think…

APR
APR is short for Annual Percentage Rate and was introduced under the Consumer Credit Act 1974 to make loan deals directly comparable. An APR is the yearly cost of a loan (or mortgage or credit card etc), expressed as a percentage. This figure takes into account not only the interest payable over the term of the loan, but also any upfront fees and charges. However, it would not take into account any early repayment fees that you might incur, and these do apply to the vast majority of unsecured loans (but not, of course, here at Zopa!).

Everyone is always searching for the lowest APR rate they can get because of course they’re cheapest in the long run, and indeed Zopa lenders have ensured that we’ve often been table-topping on the comparison websites. However, for all the attention APR rates get, seemingly large increases in APR can make very little difference on the relatively small sums of money involved in a personal loan. For example, a hike of 1.0% in the APR on a £5000 loan over 36 months, increases the monthly repayment by just £2.14 - less than a pint and a packet of salt & vinegar!

Therefore it’s always worth checking the early repayment fees on a loan as well as the APR, because if you do wish to pay it off early, it’s important to ensure that your cheap loan is as flexible as you need it to be. Of course, Zopa doesn’t charge any sneaky penalties or admin fees for any kind of overpayment or full early settlement on a loan, so not only is a Zopa loan one of the cheapest available, it’s also one of the fairest and most flexible. Good eh?

Next week, AER…

Wimbledon Tennis – White clad players on green grass, a large glass of Pimm’s No. 1 in my hand and I’m in heaven.

A Music Festival – Doesn’t matter which one and it usually doesn’t matter if it rains or not (it most likely will rain!) you’re still always guaranteed an amazing time and you can master the art of making welly’s look cool.

Chatsworth House – Surrounded by beautiful countryside in the Peak district, this is perfect if you want to get out of the city. I thoroughly enjoyed my visit by having cream teas and drinking copious amounts of the local ale.

The Isle of Wight – Feels like you’re going abroad because you have to get on a boat! There are also a surprising number of activities and events from carnivals and concerts at Osborne House to the steam railway. There’s even a Morris Minor Rally! Or you can just head down to the local pub and enjoy the Isle of Wight lobster. Yum!

But never fear – there are online tools designed specifically to show you where your cash goes. They’ll help you find out where you’re spending – and you don’t even have to fill in all the details manually.

Not only do these tools automatically add each expenditure to your list, but they also categorise it for you so you can start to see exactly where you could be cutting back.

You can even set up alerts to stop you from going over your overdraft limit. The first one we’ve found is called Kublax. They say that it’s secure and it’s free to use, so have a look and let us know what you think!

Zopa feature in the recent article entitled Post-Consumerism: Emerging Needs and Market Opportunities - and they use us as one of their examples of a so called ‘Collaborative Networked Business Model’. Apparently this mean we “put citizens at the core of value creation and are actors in the delivery of the service itself.”
Well, we do try. You can have a look at the whole article here.

‘Peer-to-peer lending platforms: These websites, through which savers pool money and lend to borrowers, have also been boosted by the crisis. Derisory interest rates are encouraging savers to seek better returns elsewhere. Zopa, a British website that pioneered the concept, says the number of lenders joining it has soared. For borrowers spurned by their banks, low-cost and unleveraged social lenders are an attractive alternative. Zopa’s boss, Giles Andrews, says new entrants like his should gain from how the crisis has undermined customers’ faith in banks’ solidity and intensified their doubts about whether the banks have customers’ best interests at heart.’

You can see the whole article here.

In December, we blogged about a film called Us Now that featured Zopa.

We featured alongside innovations such as SlicethePie, Ebbsfleet United and Couch Surfing in the documentary about the power of mass collaboration, government and the internet.

Us Now tells the stories of online networks such as Zopa that are challenging the existing notion of hierarchy. For the first time, it brings together the fore-most thinkers in the field of collaborative governance to describe the future of government.

Our MD Giles explains why Zopa is the future in terms of lending and borrowing, and if that’s not enough to tempt you, Adilowes of Zopa forum fame features as his vinyl spinning, disco DJ alter ego, explaining how Zopa allows him to be his own bank manager.

The broadcast version of Us Now will be released tomorrow (12th May) exclusively via joiningthedocs.tv , and will be free to download for a limited period.

But what about all the other great entries?
Well this is where you come in. We have a ‘people’s vote’ currently running on our forum where you can vote for your favourite and the winner of this category gets a rather nice bottle of champers. The voting’s getting interesting, so make sure you have your say and press your buttons now!

Now surely all they need to do is link it to one of those dating sites and they’re on to a winner!

You may or may not know (depends on how much you liked Maths at school, I guess) that the Zopa logo is a Venn diagram, depicting the overlap between lenders’ and borrowers’ rates - the dark grey bit in the middle is the Zone of Possible Agreement, geddit?
But actually, we’re really rather partial to this Venn diagram that finally clears up exactly where biscuits begin and cake takes over. Thanks goodness that’s been sorted out!

“A green shoot
Which financial institution has just reported a 140 per cent rise in lending year on year? The answer is Zopa, the online “lending site” - never a bank - where the borrower and lender agree the rate at which transactions are carried out. (Can’t quite see that catching on with the high street banks.) Sure, only £35m has been lent in this way so far. But the journey of 1,000 miles begins with a single step. The recovery starts here”.

Big thanks to that man Stefan for saying so! Doesn’t it feel good to be part of the solution?

When she told us all about it, a big grin spread across everyone’s faces. It was impossible to resist.
So we’re dead chuffed to know that our service is appreciated - and thanks to that man who went out of his way to make our days.

We’re running a competition to find the two best video clips, one for borrowers and one for lenders, that explain how Zopa works nice and simply.
To be in with a chance of winning the moolah, all you need to do is film the clip, upload it to YouTube and send the link to us in an email by the end of the month.

It doesn’t need to be a big flash production with makeup, lighting and luvvies, but why not get your mates involved with a stash of Monopoly money?
Or perhaps something involving Lego men or those cartooning skills you never knew you had?

We’ve got a bit more info for you here, but suffice it to say that the winning entries will be featured on the Zopa website to help explain what we do to newbies and hopefully used in a bit of PR too (if you’re OK with that).

We look forward to seeing your vids!

Q: What are banks for?
A: To make money.

Q: For the customers?
A: For the banks.

Q: Why doesn’t bank advertising mention this?
A: It would not be in good taste. But it is mentioned by implication in
references to reserves of £249,000,000,000 or thereabouts. That is the
money they have made.

Q: Out of the customers?
A: I suppose so.

Q: They also mention Assets of £500,000,000,000 or thereabouts. Have they
made that too?
A: Not exactly. That is the money they use to make money.

Q: I see. And they keep it in a safe somewhere?
A: Not at all. They lend it to customers.

Q: Then they haven’t got it?
A: No.

Q: Then how is it Assets?
A: They maintain that it would be if they got it back.

Q: But they must have some money in a safe somewhere?
A: Yes, usually £500,000,000,000 or thereabouts. This is called
Liabilities.

Q: But if they’ve got it, how can they be liable for it?
A: Because it isn’t theirs.

Q: Then why do they have it?
A: It has been lent to them by customers.

Q: You mean customers lend banks money?
A: In effect. They put money into their accounts, so it is really lent to the banks.

Q: And what do the banks do with it?
A: Lend it to other customers.

Q: But you said that money they lent to other people was Assets?
A: Yes.

Q: Then Assets and Liabilities must be the same thing?
A: You can’t really say that.

Q: But you’ve just said it! If I put £100 into my account the bank is
liable to have to pay it back, so it’s Liabilities. But they go and lend
it to someone else and he is liable to have to pay it back, so it’s Assets.
It’s the same £100 isn’t it?
A: Yes, but….

Q: Then it cancels out. It means, doesn’t it, that banks haven’t really any
money at all?
A: Theoretically……

Q: Never mind theoretically! And if they haven’t any money, where do they
get their Reserves of £249,000,000,000 or thereabouts??
A: I told you. That is the money they have made.

Q: How?
A: Well, when they lend your £100 to someone they charge him interest.

Q: How much?
A: It depends on the Bank Rate. Say five and a-half percent. That’s
their profit.

Q: Why isn’t it my profit? Isn’t it my money?
A: It’s the theory of banking practice that………

Q: When I lend them my £100 why don’t I charge them interest?
A: You do.

Q: You don’t say. How much?
A: It depends on the Bank Rate. Say a half percent.

Q: Grasping of me, rather?
A: But that’s only if you’re not going to draw the money out again.

Q: But of course I’m going to draw the money out again! If I hadn’t wanted
to draw it out again I could have buried it in the garden!
A: They wouldn’t like you to draw it out again.

Q: Why not? If I keep it there you say it’s a Liability. Wouldn’t they be
glad if I reduced their Liabilities by removing it?
A: No. Because if you remove it they can’t lend it to anyone else.

Q: But if I wanted to remove it they’d have to let me?
A: Certainly.

Q: But suppose they’ve already lent it to another customer?
A: Then they’ll let you have some other customers money.

Q: But suppose he wants his too….and they’ve already let me have it?
A: You’re being purposely obtuse.

Q: I think I’m being acute. What if everyone wanted their money all at
once?
A: It’s the theory of banking practice that they never would.

Q: So what banks bank on, is not having to meet their commitments?
A. YOU GOT IT!

I shan’t summarise the evening, as it’s been rather well done for me by our old colleague, Simon D-J in his blog and indeed many other have commented here, here and here.

Suffice it to say that we all enjoyed the lively debate, and there were even a few laughs!
It was also great to hear about other ventures that hope to add to the collective online flexing of financial muscle.

Having withdrawn our PPI offer several months ago and with plenty of comment from us in this blog and to other bodies, our views on the subject are well documented. But we’re pleased to see that the banks are taking such proactive steps and look forward to seeing what effect, if any, this has on the interest rates that they advertise on personal loans in the future.

Well our colleagues over in Italy have definitely been enjoying themselves as they celebrated their first birthday on Friday.
In just one year, they’ve disbursed 4.3m Euros to become the third largest peer-to-peer lender in Europe (after Zopa UK and Smava in Germany).

A very Happy Birthday to them and all their members!

Oh yes indeedy!
Yet more on-screen attention for Zopa, but this time focusing on two of our members, Ruby and Rob, and how they’ve helped each other out.
Thanks to them both for taking the time to do this, we really appreciate it and so did all those watching by the looks of it - the website and our phone lines are busy, busy, busy!

Please do come and join the discussion - sign up for your free ticket here.

For example, I was cycling over some wobbly paving stones last night and the noise they made as they shifted under my bike just took me back to my childhood and the cul-de-sac I used to cycle round. Fond memories (until I flew over my handlebars )

Let us know your favourite noises too; here’s a couple more of mine to get you going:
- a purring cat - what more satisfied noise can there be?
- the sound of snow crunching underfoot - that just means fun stuff like sledging or a snowball fight is on the cards!

Whatever your nice noises are, hope you hear them soon!

That’s the opening gambit for a new film, entitled Us Now, about the power of mass collaboration, government and the internet in which Zopa has featured along with others such as SlicethePie, Ebbsfleet United and Couch Surfing.
The film is directed by Ivo Gormley, produced by Banyak Films and will be shown at the RSA on Wednesday 11th December at 6pm.

If you like to come along to see it, you’re welcome to register for free tickets here.
Some of us from the office will be there, along with adilowes of Zopa-forum-moderating fame who also features in the film as his vinyl-spinning disco DJ alter ego!
It’d be great to see you there too.

We’re also told that the film will be aired on Channel 4 at some point next year.

Even better, I found a member who’s not only twittering away, but has also started a blog to share the progress of his new lending account.
Not only am I really interested to see how this pans out for him, but I love that he’s willing to share the financial too-ings and fro-ings on this account for us all to see and for newbies to learn from.

Well done that man!

We always took the view that the SEC would likely view our platform, as operated in the UK and Italy, as requiring registration with them. Individual promissory notes from borrowers could be seen as “securities” needing registration, and even if not then the firm at the centre dealing with them could require it. That’s the key reason why we didn’t launch our UK model in the US and watched with great interest when others did proceed with platforms that we felt carried regulatory risk. Lending Club were the first to acknowledge this risk in seeking registration in April, a process which took 6 months at a time when the SEC were arguably a little less “occupied” than today. At least they submitted themselves voluntarily which must have earned them some brownie points. They had also, rather smartly in my view, obtained some institutional funding in order to be able to continue lending, albeit on a small scale, while they were closed to working with normal “retail” lenders. We share something with Lending Club in that we both believe that P2P platforms should provide some added value in credit assessment and not leave this highly complex area solely to uninformed amateurs - no offence intended to any such people reading! The benefit of this approach has been borne out by their much better loan repayment performance than other US players.

However the interesting point is not just whether SEC registration is required, and if so how to get it, but what does an SEC registered business then look like? Our understanding is that it involves making your entire website in effect into a giant prospectus with all the verification issues that entails. I think it looks very difficult to run an interesting business that way.

The next event of note was Prosper deciding last month, one day after issuing a statement that it saw no need and after Lending Club had reopened for business , to seek SEC registration à la Lending Club. What sequence of events led to this Damascene conversion is open to conjecture. However it is noteworthy that the SEC issued a “Cease and Desist” notice to Prosper earlier this week, so it looks like some feathers are somewhat ruffled.

Finally we have just heard that Loanio has also entered a “quiet period” while it makes the appropriate registrations with securities authorities. See this story at finextra for more.

I think it’s a real shame. I doubt all the players will re-emerge from their quiet periods, or even if they do if their propositions will be unscathed. I suppose it vindicates our original thinking but that’s a pretty hollow victory given our own lack of success in the US to date. US consumers have shown they welcome P2P finance (as both lenders and borrowers) and we would have loved to take our model to them, difficult credit market conditions notwithstanding. Maybe one day….