Quickquid collapse: Complaints against payday lender 'unlikely' to be progressed
Quickquid became the UK’s largest remaining payday lender after Wonga became insolvent following compensation claims and regulatory pressure
The 5,500 complaints against Quickquid are unlikely to lead to compensation for customers, after the payday lender appointed administrators.
The Financial Ombudsman Service (FOS) said on Friday afternoon it was “unlikely that we will be able to progress any existing complaints” about Cash Euro Net UK, the company which operates under the Quickquid brand name.
“Once we have clarity on this from the administrators of the firm, we will be writing to people who currently have cases against Cash Euro Net with us to advise them on what they should do,” the Ombudsman said.
The company has now appointed administrators from Grant Thornton in the UK, after its American parent said it would pull out of the country.
End of the road
New York-listed Enova said on Thursday it would leave the UK market entirely, after it clashed with regulators over the thousands of complaints made against its services.
The group said it had been unable to reach a solution in discussions with the FOS and would take a $74m (£57.6m) hit to cease UK trading.
Advice for customers
The administrators said anyone with outstanding loans to the company should continue to pay them back in the usual way.
The Government's Money and Pensions Service also advised customers to keep up with their payments to Quickquid.
"While you may be tempted to stop your repayments, it is crucial to keep to your regular schedule, because if you have entered into a loan agreement you must fulfil it," said Money and Pensions Service acting CEO Caroline Siarkiewicz.
"If you miss any repayments you could be hit by fees and additional charges, and it could also harm your credit rating."
John Cullen, a business recovery partner at accountancy firm Menzies LLP, said: “For former customers, who feel they have been taken advantage of and are in financial hardship, the future is still uncertain, as the value of any compensation payouts will now depend on the process of closing the company.
"What is clear is that in the face of growing regulatory pressures, the curtain appears to be drawing on the payday lender market.”
Challenging times for payday lending
The UK’s payday lenders have come under regulatory pressures in recent years. Wonga filed for administration in August last year after a surge of customer compensation claims for irresponsible lending pushed it over the edge.
The firm had struggled with multiple consecutive annual losses after the Financial Conduct Authority capped the fees and interest controversial short-term lenders could charge in 2014.
Dr Roger Gewolb, founder of loan price comparison site FairMoney.com, said the lender’s collapse could see more people turning to peer-to-peer loan sites.
