Zopa has become the latest UK FinTech to be valued at $1 billion after it confirmed a £220 million funding round.

The London firm achieved unicorn status, according to sources, with the backing led by Japanese giant SoftBank’s Vision Fund 2.

The round, which included participation from Chimera Capital alongside existing investors IAG Silverstripe, Davidson Kempner Capital Management LP, NorthZone and Augmentum Fintech, comes ahead of an anticipated IPO in London in the final quarter of 2022.

Zopa, led by co-founder and CEO Jaidev Janardana, started out as a peer-to-peer lending platform way back in 2005 but increasingly began to provide banking services five years ago.

After raising £140m from IAG in 2019 to maintain its provisional banking licence, it secured a full banking licence the following year.

Unlike other neobanks, it is not focused on current accounts but savings accounts, which complement its loan and credit products.

With 500,000 users in the UK, it also provides auto finance and has processed £700m in deposits to date, with 150,000 credit card customers.

On track to turn a profit by the end of this year, its run rate stands at £85m. It expects that to double to £170m by 2022. 

“We believe Zopa’s fast-growing market penetration reflects high customer demand for adaptable financial services within a usable platform that can be customised to their specific needs,” said Sourav Sen, investor for SoftBank Investor Advisers, in a statement. 

“Zopa is fast emerging as a leading player in the UK’s nascent neobanking sector and we are proud to partner with Jaidev and the team on this journey.”