CashEuroNet UK LLC, trading as Quick Quid and Pounds to Pocket has agreed with the Financial Conduct Authority (FCA) to provide redress to almost 4,000 customers to the value of £1.7m. This follows concerns raised by the FCA about the firm’s lending criteria.
The FCA has been working with the firm since it took over regulation of consumer credit on 1 April 2014. An independent Skilled Person was appointed in September 2014 to review CashEuroNet’s lending decisions which revealed that some customers were able to borrow amounts greater than they could afford to repay.
The firm has now made changes to its lending criteria and has reassessed all loans that have been granted since 1 April 2014 and which were in arrears for 30 days or more against the new criteria. As a result of this exercise the firm identified a group of customers who were lent sums in excess of what they could afford to repay. The 3,940 affected customers will receive redress totaling £1.7 million as follows:
- 2523 customers will have their current loan balance written off
- 961 customers will be paid a cash refund of interest paid on the unaffordable element of the loan, and
- 456 customers will receive both a cash refund and have their current loan balance written off
Jonathan Davidson, director of supervision – retail and authorisations at the FCA, said:
“We are pleased that CashEuroNet is working with us to address our concerns.
“It is important that firms carry out appropriate affordability checks and pay particular attention to fair treatment of those who have trouble meeting their loan repayments.”
Customers do not need to take any action. CashEuroNet will start contacting customers immediately and plans to complete the redress exercise within the next 60-90 days. There is also further information on the websites of Quick Quid and Pounds to Pocket.
Notes to editors
- Further information can be found on the Quick Quid and Pounds to Pocket websites.
- On 1 April 2014, the FCA took over responsibility for consumer credit and the regulation of 50,000 consumer credit firms, including logbook lenders, payday lenders and debt management firms.
- On 1 April 2013 the FCA became responsible for the conduct supervision of all regulated financial firms and the prudential supervision of those not supervised by the Prudential Regulation Authority (PRA).
- The FCA has an overarching strategic objective of ensuring the relevant markets function well. To support this it has three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers.
- Find out more information about the FCA.