QuickQuid collapse plunges one million customers into uncertainty
The largest payday lender in the UK, QuickQuid, has fallen into administration and left more than one million customers facing financial uncertainty.
CashEuroNet UK, which operates the QuickQuid and On Stride brands, has stopped lending following the appointment of Grant Thornton as its administrator.
The Chicago-based owner of the business, Enova, had decided to stop trading in the UK after failing to reach an agreement with the UK’s financial ombudsman over how many customers it should compensate over past loans.
The Guardian reported that CashEuroNet UK accounts for up to 25% of the UK payday loans market. While its total customer numbers have not been disclosed, the QuickQuid website claims to have served “1.4 million customers and counting”.
Payday lenders have faced a drastic rise in claims from customers who say they have been mis-sold loans they cannot afford.
Wonga, the former industry leader, collapsed last year and The Money Shop failed in June due to similar pressures.
Grant Thornton said there would be no new lending by the business and that customers should continue to make payments as usual.
It said: “The joint administrators are working closely with the Financial Conduct Authority, supporting the company’s creditors and customers where possible.”
In light of the move into administration, the outlook is not good for those customers with outstanding compensation claims against QuickQuid, after the Financial Ombudsman Service said it might not be able to process any more claims.
The Money and Pensions Service, an official body sponsored by the Department for Work and Pensions, said many customers would be feeling uncertain about what this latest development meant for them but should keep up their repayments.
Caroline Siarkiewicz, the service’s acting chief executive, said the legal obligation for customers to repay their debts would almost certainly remain unchanged, and those who failed to make their repayments might have their account passed to a debt recovery agency.