QuickQuid collapse: Do you still owe money? Are you entitled to compensation? What it means for you

QuickQuid customers could be entitled to compensation under FCA regulations
QuickQuid

Britain’s biggest payday lender is on the brink of collapse, plunging thousands of customers into financial uncertainty.

QuickQuid was rocked by more than 3,000 complaints over the first half of this year, most of which came from people claiming they were mis-sold loans they couldn’t afford.

The lender’s US-based owner Enova said it had tried for months to reach a deal with British authorities to find a “sustainable solution to the elevated complaints”.

But last night the firm’s chief executive David Fisher confirmed the talks had failed, and they would be pulling QuickQuid from the UK market.

For anyone wondering if they’re owed compensation from the loan service or confused as to whether they still owe money, here’s everything you need to know.

It comes a year after the collapse of rival lender Wonga 
PA

Should I continue my repayments to QuickQuid?

Yes. QuickQuid customers should continue repayments to the loan firm despite uncertainty around its future, according to the Government’s Money and Pensions Service.

The acting chief executive of the service Caroline Siarkiewicz said: “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.

“If you miss any repayments you could be hit by fees and additional charges, and it could also harm your credit rating.”

How do I know if I’m owed compensation from QuickQuid?

Five years ago, the Financial Conduct Authority (FCA) introduced rules to prevent people being trapped in debt spirals, following an outcry from consumer campaigners and charities.

The regulator placed a cap on the amounts payday lenders were allowed to charge in interest rates and fees, and introduced enhanced affordability checks.

If QuickQuid sold you a loan you couldn’t afford at the time of borrowing, or if having the loan meant that you couldn't pay your bills or other debts then, according to FCA rules you were irresponsibly lent to, and so you could be entitled to compensation.

According to money blogger DebtCamel you may also be entitled to compensation if you took out back-to-back loans or rolled out a loan repeatedly, since this suggests the loan was not affordable.

How do I claim compensation?

Advice from DebtCamel is as follows:

You need to write a formal complaint letter to QuickQuid, or the lender in question, explaining how you were irresponsibly lent to.

You will need to include evidence of this, so make sure you check carefully through emails, bank statements and credit reports for relevant proof.

You should also make copies of this evidence before sending it, in case anything happens to the relevant documents.

In your letter, make clear that you are claiming for "unaffordable loans" and ask for a refund of the interest and charges you paid.

DebtCamel provides a template here.

Make sure you keep a record of all receipts and other evidence surrounding your payday loans 
Getty Images

How much compensation could I expect to receive?

QuickQuid should refund all the interest you paid from your third loan onwards.

This is because payday loans are meant for short term problems and the lender should not have continued giving you loans.

You may be able to claim from your first or second loan sometimes if these were rolled, topped-up or were very large.

How long will I have to wait to receive compensation from QuickQuid?

Current regulation gives lenders eight weeks to reply to a complaint.

However, QuickQuid claims to have lent to more than 1.4 million people in the UK, so delays could be expected if the company collapses.

Tola Fisher, a personal finance expert at Money.co.uk, explained: "If you're currently claiming compensation from QuickQuid for a mis-sold loan and it goes bust, you will need to wait until the administrators have wound up the company.

"Unfortunately you might find yourself at the back of a long queue to get hold of your money.”

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