After 16 years of peer-to-peer (P2P) investments, Zopa is closing its retail investing business.

The British FinTech revealed it would sell all of its retail investor portfolios at full value.

The company said to make the move “as smooth as possible” it will buy the P2P portfolio and P2P customers will receive their investment balances back by the end of January 2022.

The firm explained that over the past few years, customer trust in P2P investing has been damaged by a “small number of businesses” whose approach led to losses for retail investors.

The company added that changing regulation which followed this damage had raised the operational cost of running its P2P business, as well as the cost of attracting new investors to its platform.

“To offset these increased costs and ensure we have a sustainable and profitable business, we’d need to reduce investor returns to a point where they’d no longer be attractive and commensurate with the risk that investors take on,” wrote the company’s chief executive, Jaidev Janardana, in an update.

Share Story: