Not upheld: Other regulated complaint complaint against Zopa Limited

Decision detail

Summary

Mr S invested in Zopa's peer-to-peer lending platform for several years. When Zopa announced in December 2021 that it would close its platform, it offered to purchase investors' loan portfolios at face value for active and arrears loans, but at zero value for defaulted loans. Mr S's portfolio was acquired on 14 January 2022, but he complained that his defaulted balance had increased by £25.30 between the announcement and completion, meaning he received less than expected. He also objected to receiving nothing for his defaulted loans. The ombudsman found that Zopa had clearly communicated the compensation terms and reasonably applied them, including accounting for loans that defaulted during the wind-down period. The ombudsman noted that Zopa's offer to pay full face value for arrears loans (which carried enhanced risk) was reasonable and generous, and therefore Mr S was not treated unfairly overall.

The Ombudsman's reasoning

The ombudsman found that Zopa's decision to close the platform was a commercial judgment that could not be challenged. However, the ombudsman could assess whether Mr S was treated fairly in the compensation process. The ombudsman found that the terms were clearly communicated: face value for active and arrears loans, zero value for defaulted loans. While Mr S was disappointed that loans defaulted late in the process, the ombudsman found it reasonable to account for defaults occurring before completion. The ombudsman also noted that Zopa's offer to pay full face value for the 70 arrears loans (which carried enhanced risk) was reasonable and somewhat generous, and when weighed against the zero value for defaulted loans, Mr S was not treated unfairly overall.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website