Digital banking challenger Zopa has closed a £20 million internal fundraising round.

The round, led by existing investors, comes nine months after Zopa secured its full banking licence in June last year.

The round was led by IAG Silverstripe, with participation from a number of investors including Augmentum, Waterfall managed Alternative Credit Investments and Venture Founders.

The bank has £250 million in deposits and has launched fixed terms savings accounts along with a credit card offering in addition to its personal loans business.

Zopa said the funds would be used to fuel further growth of its business and the development of products suited to changing customer needs in the wake of the Coronavirus pandemic.

The company said that it has seen a sustained need for access to credit as people look to carry out home renovation, buy cars and revive postponed wedding plans.

To date, Zopa has lent out more than £5bn to low-risk UK customers via its unsecured loans, credit cards and car finance products.

Jaidev Janardana, chief executive of Zopa, said: “Less than a year since launching our bank, we have exceeded our plan for growth, both in terms of customers and balance sheet. This capital injection will enable us to continue on this accelerated path.

“Our strong entry to the UK savings and credit card markets shows the organic appeal of our products and we are happy to have investors who share our excitement at the opportunity to serve more customers across more product categories.”

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