A real coup for Credit Unions here, and I am impressed and not surprised to see FORUM involved. 

Zopa going live with Credit Unions as partners

“The merging of financial services and social networking is a great way to reach the younger generation,” says Doug True, senior vice president of FORUM Credit Union of Fishers, Ind., one of Zopa’s launch partners.

Having said that, I will need more detail before I understand the model being implemented, that appears to involve CD’s at the Credit Unions.  I hope there is a simpler explanation that that provided at the WSJ.

Lenders, meanwhile, buy one-year Zopa CDs that are used to help fund
those loans. If a prospective lender wishes to help out a borrower, the
lender can direct all or a portion of the interest on the Zopa CD —
interest rates are currently capped at 5.1% — to help lower the
borrower’s loan payments. Whether a borrower repays their loan on time
has no effect on what an investor earns on a Zopa CD.
…..

Zopa lenders should get their principal back since their deposits are
insured for as much as $100,000 per credit-union member. Borrowers and
lenders don’t pay any fees, although borrowers — who will need a
minimum FICO credit score of 640 — could be subject to late fees.
Zopa, for its part, shares in the interest-rate spread that the credit
unions earn between the loans and deposits.

In order to participate in Zopa’s system, consumers
must sign up with one of the six credit unions participating with Zopa.
For their part, the participating credit unions hope to expand their
membership and stand out from the crowd.

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