Pawnshop firm to refund £2million to customers over unaffordable loans
THOUSANDS of borrowers could be repaid for unaffordable loans made between April 2014 and October 2019.
Lender H&T said he would repay customers over £2m after finding more than one in 10 loans should never have been made in the first place.
No less than 9,800 loans granted to 8,000 customers should have been refused by H&T.
But that money is flowing back to customers, so if you borrowed money between dates, you might be indebted.
Specifically high-cost short-term loans (HCST) that the company made during the period.
Approximately 11.5% of HCST unsecured loan clients are eligible for repayment.
Of the £2m total, £1.6m is on track to come directly to them in the form of refunds.
This means that on average each customer will receive £264, the company said.
The company has been studying these loans since 2019.
Regulators found that these products were being sold unfairly and that the supplier had failed to carry out proper accessibility checks.
The Financial Conduct Authority has now given the go-ahead to compensate customers.
The other remainder of the £2million prize pool will be available to adjust customers’ outstanding loan balances.
The company no longer offers expensive, short-term, unsecured loan products.
But you could be reimbursed for any mis-sold loan, even if you paid off the debt years ago – so it’s worth checking.
This is especially the case if you have struggled to repay or had to borrow money to pay them back and have gone into debt as a result.
H&T revealed that customers whose loan should not have been granted and who need to be repaid will be contacted directly, so you should not do anything to inquire about the repayment.
The pawnshop’s managing director, Chris Gillespie, said: “H&T is committed to providing services that maintain the highest standards of customer service and regulatory compliance, and we have cooperated fully and constructively with FCA throughout this review.
“We are pleased that the review is now complete and that the majority of HCST loans made by H&T are considered to have been loaned responsibly.”
We asked the company if there was a deadline for requesting the refunds, and we’ll update this story once we know more.
And the same goes for customers who think they’re affected but haven’t been contacted either – we’ll update this story once we know more about how you can apply.
The exact amount you get back will depend on the amount you borrowed and the length of your loan.
You may need to provide details of the loan you have taken with sample emails or letters.
And you may need to prove that you couldn’t afford the loan when you took it.
This comes after millions of people had the opportunity to claim the money from payday loans earlier this year.
Clients of Provident Financial, Greenwood, Flo and Satsuma had until the end of February to claim the mis-sold loans that were issued between April 2007 and December 2020.
Meanwhile, QuickQuid customers could get an average payout of £850.
And Money Shop, Payday Express and Payday UK customers started seeing cash refunds earlier this year.
Check out our guide on how to claim badly sold loans and find a sample letter to make a claim from the DebtCamel blog.
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