I’ve been a user of Zopa for about 15 months now. If you’re not aware of it, Zopa is a peer-to-peer lending exchange: they’re a market where people who need money can borrow it from people who can lend it. (Working for a different kind of exchange myself, I like the concept.)

I spent some time working out how much interest that Zopa has been paying me since I joined last August. One of their downsides is that they don’t seem to make it very clear what annualized interest you’ve actually been earning.

It turns out that I’ve been paid slightly more than 7.4% AER, net of bad debt (there was none) and Zopa’s 1% annual fee. During that time, the Bank of England base rate has been 0.5% and the best savings rate has barely brushed 3.5% on average.

Of course, the FTSE All-Share made 22% AER over the same period, but Zopa is still a nice fixed(ish)-income way of diversifying.

One thing which is a bit annoying with Zopa is that you have to constantly adjust your offer price to follow the market and get the best rate for your money (which can be coming back in as repayments from other borrowers). Zopa has 5 different creditworthiness markets with different prices, and I worry about ending up with skewed exposure towards one category. It would be great if Zopa had an API so I could adjust my prices automatically.