WAGEDAY Advance customers owed compensation after being mis-sold unaffordable loans will get less than 6p for every £1 they're owed.
The lender's parent company, Curo Transatlantic Limited, went bust in February last year leaving 650,000 hard-up Brits in limbo.
Borrowers were then given until the end of August to apply for compensation, but only 100,416 claims were submitted out of an expected total of 256,000 eligible customers.
In September, administrator KPMG said it expected victims to get between 4.5p and 5.2p per £1 owed in compensation.
But this week, KPMG announced that 5.68p per £1 will be paid out towards these compensation claims.
That means a customer claiming £1,000 back on a mis-sold payday loan, for example, will only receive £56.80.
Are you due a payday loan refund?
MILLIONS of payday loan customers may be due refunds.
Although you will no longer be able to make any more claims to Wageday Advance, you may be owed cash for loans taken out with other payday lenders.
Refunds or compensation are often given when the loan was mis-sold or where affordability checks weren't stringent enough. Here's all you need to know:
- Customers who've paid off payday loans debts can still claim. Even if you've paid off your debts you may still be able to get a refund if you struggled to repay the money at the time.
- If you're still paying off payday loan debts you can still complain. You can complain if you've struggled to make repayments. If your complaint is successful it could lower the amount you owe.
- You can still claim is the firm no longer exists. When payday lenders go bust you can still submit claims to the company's administrator, although it is less likely you will receive a refund as you'll just be one in a long line of people owed cash. Also check for complaints deadlines as some administators, such as those for Wageday Advance and Wonga, have imposed deadlines.
A statement on KPMG's website says there's insufficient money in the business to pay claims in full.
The news echoes that of customers of payday lender Wonga getting only 4.3 per cent of their compensation claims earlier this year.
Sadly, if you missed the deadline to claim, it's unlikely you'll be considered any compensation for mis-selling, KPMG said.
It said that those due a payout will receive them over the coming weeks via bank transfer or cheque.
If you need to contact KPMG, you should send an email to [email protected]
Debt adviser Sara Williams, who writes the Debt Camel blog, told The Sun: "Wageday Advance customers were often caught in the payday loan trap – when they repaid a loan they had too little left to get through the next month.
"But Wageday Advance kept on lending for years in some cases.
"The Ombudsman says they should get a refund of the interest for these 'unaffordable loans' – but now they are getting less than 6 per cent back from the administrators."
Commenting on the Debt Camel website, one customer wrote: "They originally owed me nearly £6k and I’m now getting the princely sum of £331!!!
While another added: "£273 instead of £4800… I suppose its better than nothing…
"I just wish I didn’t know it should of been that much."
The payday lender went bust in 2018 after it struggled to keep up with an influx of compensation claims for mis-sold loans.
The firm's closure follows in the steps of Wonga which went bust earlier that year for the same reasons.
It was the first leading lender to enter into administration amid the scandal – 247Moneybox, Piggybank, QuickQuid, The Money Shop and Payday UK also all collapsed in 2018.
Payday lenders are offering payment holidays for struggling borrowers during the coronavirus crisis – we explain how to get help.
Source: Read Full Article