British peer-to-peer (P2P) lender Zopa has launched a new digital bank after being granted a full UK banking licence.

Zopa Bank will offer a suite of new products and services, beginning with a fixed-term savings account, which can be opened virtually within seven minutes.

The savings account is expected to offer competitive interest rates to account holders for deposits over one to five years.

The account has been insured up to £85,000 ($106,186) by UK’s statutory deposit insurance scheme Financial Services Compensation Scheme (FSCS).

In the coming months, Zopa will also unveil a credit card with certain new features. The company claims that the cardholders will be able to manage their borrowings.

The new products from Zopa will add to their existing personal and auto loans and investment products.

Zopa CEO Jaidev Janardana said: “Securing our banking licence enables Zopa to play a wider role in the financial lives of our customers, as well as offering much-needed choice and competition to the wider market.

“Zopa is uniquely placed to provide a compelling alternative to traditional banking by leveraging its significant technological and financial services expertise to offer a wider range of great products, including savings and credit cards, alongside its personal loans and investments.” Last year, Zopa raised £140m in pursuant to the UK banking licence.

It also launched a new tool named ‘Borrowing Power’ within its app to help customers improve their credit score by helping them borrow at lower rates.

The 15-year old bank has a customer base of 300,000 people.