As global markets continue to dive, Silicon Valley is starting to batten down the hatches. For at least one company, however, the economic downturn is already having major impact, as Web 2.0, peer-to-peer loan site Zopa has announced that its US-based operations will cease.
While the company was never able to roll out its peer-to-peer microlending model in the US due to regulatory issues, it still maintained a microloan function with US credit union partners, who will now assume the accounts of US-based Zopa users. According to the company blog, operations in the UK, Italy, and Asia will not be impacted by the US withdrawal.
As P2P-Banking.com notes, the irony is not lost on Zopa that the failure of the same US regulations that prohibited the company from rolling out a peer-to-peer model in the US have resulted in the current economic climate, and the company's CFO took the opportunity to point out the company's success in European and Asian markets. The company's eventual success, however, will depend on those markets escaping a domino effect started in the country they are abandoning.