The recent troubles faced by the majority of high street banks and building societies, with their own liquidity issues and ability to lend, has meant that when it comes to being able to offer personal loans to their customers, many individuals are now being rejected for the loan they require, even if they have a clean credit history.

At the same time, people who have invested their savings with their local bank or building society have seen the rate of return on their savings fall dramatically, as interest rates have been reduced to record low levels. As a result of this disillusionment with the traditional banking sector, many people, both borrowers and savers alike, are looking for alternative and better ways to obtain either the cheap loan they want, or a better return on their savings.

One website, Zopa, which offers personal loans and investment opportunities to individuals with a good credit history has seen its business levels increase by 150 per cent over recent months. Zopa aims to match up people who are looking for a cheap loan, with people who want a better return on their savings, thereby arranging loans on a truly personal basis.

A spokesman for Zopa said “We have a stringent vetting process, we don’t have a problem admitting that and don’t want anyone to be disappointed. As the banks continue to fail their customers despite huge bail outs from the UK taxpayer, it is not surprising that record lending is taking place between the growing number of Zopa members.

Creditworthy borrowers shunned by the banks are able to access loans at much better rates. And now that banks have all but given up trying to address their liquidity problems by attracting savers, more and more people are discovering the fabulous returns they can earn on their savings by becoming a Zopa lender.”