Welcome to the world of UK Peer to Peer lending. We bring you the best personal P2P loan lender reviews, to help you make an educated decision when you choose a P2P lender. Take a look at our top selected brands above.

ZOPA Rep. APR: 7-8% 1-5 Year Terms Oldest P2P Lender
RateSetter Rep. APR: 7.1% 6 Month – 5 Year Terms UK’s Largest P2P Lender
Lending Works Rep. APR: 5.2% 1-5 Year Terms A Leader in Fraud Prevention

Peer to Peer lending in the UK

The United Kingdom is the pioneer of Peer to Peer Lending. Since ZOPA’s launch in 2005, the market has grown across the globe. But no other nation has a P2P culture as robust and diverse as that of the UK.

 Check out our Infographic laying out the history of Peer To Peer Lending in the UK, and worldwide:



With the help of LendAngel‘s stats

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The UK P2P Lending market is supervised by the Financial Conduct Authority.

Peer- to- peer depositors usually do not qualify for protection from FSCS i.e. Financial Services Compensation Scheme, which offers security of up to 85, 000 pounds per financial institution, for each saver.

However, the peer- to- peer Finance Association mandates that member firms must implement arrangements for the servicing of the loans, even if the broker firm goes bankrupt. Recently, the UK government has announced that the Financial Conduct Authority will be regulating the industry. This is after the British Business Bank was criticized of creating unfair competition in the UK Peer- to- peer lending industry by concentrating financial support through the largest platforms.


Peer to peer lending is a form of unsecured personal loan (unsecured business loans are also available in USA, Canada and Australia, but those should not be reviewed here). That means there is no lien on assets – the loan is not collateral in cases of no payment. In Zopa, for example, an experienced industry player that focuses on good credit borrowers, the estimated total “losses” ( unsecured loans never repaid) is around 0.5% annually. It can be assumed that other Peer to Peer lenders have higher loss rates, though these numbers are often not published.


Image from: http://www.debtsteps.com/debt-consolidation-loans.html


No Credit Risk

The peer- to- peer industry requires borrowers to fill out online application forms for loans. Unlike typical credit applications, they only count the application as a ‘soft’ inquiry on your credit report, which does not negatively impact your credit score. If the loan is approved, your interest rate will be determined according to your requested loan amount, credit score, credit history, and loan term, among other potential factors.

Since different places in the UK have their own regulations about investing and securities, borrowing from P2PL is not allowed everywhere.


The concept of P2P lending is quite straight forward. There are two types of participants in this market: lenders (as a form of investment), and borrowers (a form of loan). These two interconnect through an advanced platform wherein investors bid on loan proposals using a “Reverse Auction” format.

Each lender/investor specifies how much risk he wants to take, and in accordance, what interest rate is expected. The higher the interest one aspires to, the higher the associated risk. The same goes for the borrowers. They will supply as much information as possible to the P2P loan platform, to get as close as possible to a perfect risk score. The better that risk score is, combined with loan amount and term requested, one may get better terms for loans.


Comparable Markets

The market becomes more unified in 2017, and the UK lending landscape is lead by a lot of American companies, while British companies try to penetrate the American and Australian markets. The market that most resembles the UK market to us, especially in business financing is the Australian one.

Best Peer To Peer Lending UK Companies

View our selection below for the top companies for P2PL.


Zopa is the leading Peer to Peer lender in the UK. It started off in 2005 as the world’s first P2P platform, and hasn’t stopped since then. It has been covered by major newspapers like The Guardian and The Telegraph. It offers 1-5 year loan terms, with APR as low as 4.8% and representative APR of 7-8%.


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RateSetter is the UK’s largest Peer to Peer loan platform, and is highly appraised by clients. Money within your account within 24 hours, at representative rates of 7.1% APR. Only 10 to 15% of applicants are approved, ensuring high qualification among users. Borrowing starts at as little as 500 Pounds.


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Lending Works is new and exciting. They provide very low, bank-beating, Rep APR of 5.2%, for medium sized loans at 3 years terms. Your application takes only minutes. They are a member of UK’s leading fraud prevention service.

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The largest, UK-government backed P2P platform which has recently expended to the USA. Very low APR of min 6%, but rather difficult to qualify. Most credible, and easiest to sign up with.


Read Funding Circle Review


Up and coming and innovative service, offering both P2P lending, and cash advances. Fleximize is not that well known yet but we anticipate it to become one of the top UK platforms.


Read Fleximize Review


Why Peer To Peer lending

  • Why Peer To Peer Lending

    • Peer to Peer lending in the UK is a much easier way of getting instant funding than from banks.
    • If you have bad credit and banks rejected your loan request, you might still have a chance with peer to peer lending.
    • Depending on your bank account, your personal credit, and the company you apply to, you might end up with lower interest rates than those issued by banks.
    • P2P Lenders usually don’t have early repayment fines, while most banks do.
    • P2PL provides a Socially Conscious Investment Chance: P2P Lenders help support people who wish to break free from high rate debts, assist individuals engaged in activities or occupations which are deemed positive to their community, and also avoid investment in people employed in companies deemed detrimental to their community.

* Tips for Beginner Borrowers *

It is not recommended to take out a loan for a larger amount than you actually need. Like any other type of loan, falling behind on P2P loan payments means that you’ll have to pay more in the long term. Borrowers are encouraged to take out a loan at the shortest possible terms, in order to pay the least for the funds borrowed.

When peer- to- peer site happens to go wrong, who qualifies to collect the loam?

Technically, the loan issued is between the lender and the borrower. Therefore, if a peer- to- peer site goes bust, you will still owe or be owed. Trade body members are often required to have insurance to pay for a third party collection agency.

The advantages of Peer to Peer Investing

For simplicity, we can put two facts on the table:

  1. Investors are likely to earn more than 5%, with interest at near global lows.
  2. The default rate for all good P2PL sites is <5%.

That doesn’t mean that this is a risk-free investment. But as credit risk assessment mechanics progress, it will become less risky. Make sure your investment strategy accounts for all possibilities, based on hedging risks and investing in multiple individuals or businesses, thus minimizing risk. It’s also important to vary the type of loans you participate in. If you are going for high interest loans, you are aiming for higher-risk investments by default.


Disadvantages of Peer to Peer Lending in UK (For investors)

Government Protection (or lack thereof)

Unlike depositing cash in banks, peer- to- peer lenders can select whether to lend their cash to riskier borrowers who present higher returns or to safer borrowers who’ve got lower interest rates. Also, repayment after borrower default isn’t often guaranteed by the UK government.