PiggyBank payday lender customers urged to submit complaints
MORE than 387,000 customers of a collapsed payday lender will be asked to submit claims for redress to administrators.
Dorset-based DJS (UK) Limited – trading as PiggyBank – was one of the UK’s 10 largest payday lenders when it took office in December 2019.
It provided short-term loans of up to £1,500 at 0.8% interest per day, equivalent to an annual percentage rate (APR) of 1,270%.
The company had 57 employees at Parkway House, Avenue Road, in 2018 and was listed in the Sunday Times Top 100 Best Companies to Work For.
But he was suspended from lending for three months in 2018 when the Financial Conduct Authority raised concerns about its checks on whether the loans were affordable.
In a report covering the period from June to December last year, co-administrator Shane Biddlecombe of Fortus Recovery said there were 387,228 former customers of the company.
Since the administrators were appointed at the end of 2019, 2,376 claims for compensation totaling £1.35million have been confirmed.
“The administrators will now invite and accept complaints from historical customers. Administrators are unable to accurately estimate the level of unwarranted repair claims at this stage,” he wrote.
However, only £600,000 is expected to be available to unsecured creditors, which includes borrowers filing claims.
The administrators of DJS (UK) Ltd had estimated the claims of other unsecured creditors at a total of £467,139. They estimated that trade creditors owed £208,473.
But six creditors have so far submitted claims totaling £1.6million, and 16 have yet to submit claims.
Staff are believed to owe £175,121 in redundancy and severance pay.
The administrators expect the assets of DJS (UK) Ltd to be £16.7m, with administration costs expected to reach £4.1m, of which £1.1m administration costs.
The company owed around £21.8million to high net worth individuals who held 46 debentures – loans secured by its assets.
The administrators faced challenges from some investors and reached a compromise with one whose case could have cost hundreds of thousands of pounds in legal fees.
Staff who owed £55,051 in paid leave had their claims as preferred creditors settled.
Mr Biddlecombe said a further £840,864 had been collected from loan customers since his previous report. Administrators were supporting those who were unable to repay their refunds because of the pandemic, he said.