The Anonymous Widower

Zopa Interest Rates

Since the beginning of the year I have been tracking the rates that Zopa has been charging. 

Rates obviously vary according to your credit rating and they are split into five bands; A*, A, B and C, with an additional Y or youth band.  the A* rating is the highest and the C is the lowest, with Y being treated separately.

You can set your interest rates as you wish for the marketplace.  I always set the rates so that money is let out quickly, by adjusting it to the lowest rate of their level of High.

Zopa Rates Since January 2009

The line on the graph at the bottom is the OBR or Official Bank Rate and you can see it has really had no effect on the rate at which money is lent out by Zopa.

• Green is the Youth rate
• Red is the A rate
• Blue is the A* rate

As you can see rates have hardened since April and are probably now up by over a full point in the A rates and nearly double that in the Youth.  Remember that Zopa is a closed system and that these rates will be set purely by the demand of the borrowers and the amount of money invested. 

So much for the government trying to unlock lending with the banks.

As an aside here, I should say that I am a Control Engineer by training and know about these things and the various actions and reactions in systems.  It is just a pity that these days those controlling the banking system still stick to the their tried and supposedly tested methods, rather than using some of the things I learned about in the 1960s. 

I will return to this in another post.

July 9, 2009 - Posted by AnonW | Business, Finance | Banks, Zopa