84% of savers surveyed would not consider investing their money with a peer-to-peer lender, according to new research from uSwitch.com.

Although official figures show the UK’s peer-to-peer lending sector increased by 121% during 2013, only 2% of savers are currently using a peer-to-peer lending platform. 59% of consumers are reluctant to use a peer-to-peer lender because the industry is not covered by the Financial Services Compensation Scheme, while 39% say that it is because it is not regulated by the FCA.

A further 49% are sceptical about using peer-to-peer lenders simply because they don’t know enough about them, and 22% are weary about using a firm they haven’t heard of.

Jafar Hassan, personal finance spokesperson at uSwitch.com, said: “While the take up of peer-to-peer lending has been low so far, regulation should provide additional peace of mind. But to encourage more widespread adoption, peer-to-peer lenders need to convince consumers that their money is safe, and they can’t simply rely on regulation to do this.

“The fact is that many consumers are still skeptical about lending money if they don’t know where it’s going; others simply don’t want to use an online platform.”