Payday loan provider QuickQuid is to close
US owner company Enova announces it will leave UK market in Q4
QuickQuid, the UK's biggest payday loan provider, is to close due to regulatory uncertainty.
The firm specialises in offering high-interest loans to people looking to cover a short period, often for a few days until payday.
Regulations covering these lenders were tightened five years ago to limit the level at which interest rates and fees can be charged. Affordability checks were also introduced.
Since then, QuickQuid has faced thousands of complaints from customers who claimed they were sold loans they could not afford. Many - some estimates put the figure at 10,000 - are still unresolved. The company says it has lent to more than 1.4m people in the UK.
QuickQuid is owned by US-based Enova and is a brand name of CashEuroNet UK, which also includes On Stride previously known as Pounds to Pocket.
“Over the past months, we worked with [the] UK regulator to agree a sustainable solution to the complaints to the UK Financial Ombudsman, which would enable us to continue providing access to credit,”said Enova boss David Fisher. "While we are disappointed that we could not ultimately find a path forward, the decision to exit the UK market is the right one for Enova and our shareholders.”
The UK's Financial Ombudsman Service said that it had received 3,165 cases against CashEuroNet in the first half of the year. It was the second most complained-about company in the banking and credit sector during that period.
QuickQuid has been the largest of the UK’s payday lenders for a few years and was bigger than Wonga, which folded in August 2018. The Money Shop, another such lender, ceased trading in June 2019.