QuickQuid payday lender to close, leaving thousands of claims in limbo
The summit of Great Britain payday lender said he would withdraw from the country as a host of complaints and regulatory uncertainties rocked the company.
QuickQuid’s US owner Enova had been working for months to reach an agreement with authorities after customers have filed more than 3,000 complaints on the business in the first six months of the year.
“We worked with our UK regulator to agree a lasting solution to the high number of complaints to the UK Financial Ombudsman, which would allow us to continue to provide access to credit to hard-working Britons,” said the managing director David Fisher by announcing that the company would be stepping down. from the UK this quarter.
Enova will levy a one-time after-tax charge of approximately $ 74million (£ 58million), which includes a cash charge of $ 43million (£ 33million) to support the termination of its loans in the UK. United.
Enova did not say what would happen to its UK customers.
The company claims to have loaned to more than 1.4 million people in the country.
I am a QuickQuid customer – what should I do?
Customers of payday loan company QuickQuid are expected to continue with their repayments despite uncertainties about the company’s future, the head of the Money and Pensions department said.
Caroline Siarkiewicz, Acting Director General of the Government’s Money and Pensions Department, said: “Many QuickQuid customers won’t know what this means to them.
“While you may be tempted to stop your repayments, sticking to your regular schedule is crucial because if you’ve entered into a loan agreement, you have to stick to it.
“If you miss repayments, you could be hit with additional fees and charges, and that could hurt your credit rating as well. ”
Tola Fisher, personal finance expert at Money.co.uk, said borrowers will likely still have to repay their loans.
Meanwhile, those who complain about the process could experience delays.
“If you are currently seeking compensation from QuickQuid for a mis-sold loan and it goes bankrupt, you will have to wait until the directors have liquidated the company.
“Unfortunately, you might find yourself at the end of a long line to collect your money,” she said.
QuickQuid is the best known brand of CashEuroNet UK.
The breakdown service industry has faced a squeeze since it was subjected to stricter rules under the city’s regulator, the Financial Conduct Authority (FCA), to prevent people from being trapped in debt spirals, following an outcry from charities and consumer activists.
A cap was placed on the amounts that payday lenders were allowed to charge and they had to meet the FCA’s stricter standards in order to continue operating.
The Financial Ombudsman Service (FOS) received over 3,000 complaints relating to CashEuroNet UK between January and June 2019.
Earlier Thursday, Sky News reported that the auditor Grant Thornton had been appointed to administer the company.
Industry insiders say the industry must constantly change to meet expectations.
Meanwhile, lenders are beset by customer complaints, often encouraged by claims handling companies.
These claims were one of the main reasons rival Wonga was forced to shut down a year ago.
Claims handling companies themselves fear that QuickQuid’s failure could be damaging to consumers who have already faced an industry collapse.
It is not known how many jobs at the payday lender could be at risk if it disappears.