The Anonymous Widower

What Effect Would A Yes Vote In The Scottish Referendum Have On Peer-to-Peer Lending?

I’m prompted to ask this question, as there is a feature in the Times Money section today about the implications of the Scottish Referendum on personal finance.

Searching the Internet for “Zopa Scottish Referendum” there is this discussion in Zopa’s forum.

I’m using Zopa as an example, as it’s the peer-to-peer lender, that I know best.

There is nothing really of importance said and most participants don’t seem bothered.

I see a few small problems, but nothing that major for myself, as I suspect only a couple of percent of my money is loaned to those North of the border.

Scotland Bans Peer-to-Peer Lending

An independent Scottish government could decide to ban peer-to-peer lending (P2P) to protect Scottish banks. After all P2P lending is taking a sizeable and increasing part of the lending market.

This might mean that Scottish loans came into default. But I suspect that under International financial law, the loans would have to be repaid.

The main effect would be in the ability to make new loans to Scottish borrowers and accept money from Scottish savers. But that would only effect Scottish voters and businesses.

Scotland Makes Debt Recovery Difficult

Scottish law is already different to English and I’ve not heard of any P2P lenders having any problems collecting debts.

On the other hand, there are some advantages to having your money in a P2P lender like Zopa.

1. Zopa has a balanced portfolio of loans all over the four countries of the UK.
2. Zopa doesn’t invest money in investments that would be effected by the break-up of the UK.
3. Your money is guaranteed, but this guarantee is not dependent on government favour.
4.  For Scottish savers, with all the uncertainty of the referendum, it might a reliable P2P Lender like Zopa, might be a safe port in a storm.

A break-up of the UK might not be plain sailing for P2P investors, but I would be very surprised if there were serious problems.

September 6, 2014 - Posted by AnonW | Finance | Peer-to-Peer Lending, Scottish Referendum, Zopa