On 14 August, Instant Cash Loans (ICL) started sending out emails to 2.6million customers of the Money Shop, Payday UK, Payday Express and Ladder Loans with details about how to vote on its proposed Scheme of Arrangement.
It says customers with an affordability complaint may get 80% of the value of their complaint paid out, but this may be significantly less if a lot of people claim.
80% sounds like a very high figure to me, see Will the Money Shop really pay 80% of your payday loan refund?
If you have just had this email, I suggest you wait a few days beafore deciding whether you should vore in favour of this scheme. Voting can be done online until the 20 September, so there is lots of time to get the full facts before deciding what to do.
ICL says:
On 9th August 2019, the High Court gave us permission to ask people to whom we may own money to vote on whether or not they would like the Scheme to go ahead. We think we may owe you money because you previously took out a loan from us or one of our other companies.
If the Scheme goes ahead, we will ask you to submit a claim and, if we agree that we should not have made you a loan or you have another valid complaint about a loan, you will be entitled to a payment in 2020.
Full details are given on the Money Shop’s website.
Contents
Background – increasing numbers of affordabilty complaints
ICL had two million customers, with three big payday lending brands:
- The Money Shop was once Britain’s largest payday lender on the high street. The Money Shop stopped making payday loans in August last year.
- Payday UK and Payday Express were two large online lenders. These both stopped making new loans in October 2017.
In summer 2018, the number of affordability complaints about payday loans increased significantly. Paying refunds on these complaints forced Wonga and Wageday Advance to go under.
In the last half of 2018, ICL received 45,000 complaints. So ICL has been facing escalating costs in the last year and it has been closing shops. Now the business is being closed completely.
You are being asked to vote on the proposed Scheme
ICL is writing to all 2.6 million customers who borrowed from the Money Shop, Payday UK, Payday Express or any of its other brands to ask them to vote to approve the proposed Scheme of Arrangement.
A Scheme of Arrangement is a legal device which limits a company’s liability for some debts. A Scheme has to be approved by a court that will consider if the Scheme is fair.
If you were given a loan which was “unaffordable”, you have a claim for a refund of the interest you paid. The regulator says that a loan is only affordable if you could repay it without hardship and without borrowing again. So millions of payday loans were unaffordable and you may have a claim.
Everyone with a potential claim is a possible creditor. And creditors can vote to approve or reject a Scheme of Arrangement. This is why you have been sent this email.
These emails started being sent out on August 14. They:
- come from noreply@themoneyshop.co.uk;
- have the subject: Voting Information – The Money Shop Scheme of Arrangement;
- give you your reference code in the format xxxx-xxxx to let you vote on the scheme;
- do not ask you to reply with any personal information.
What is happening to complaints?
People who accepted an ICL offer before July 31 are getting a full refund
Some people who have already complained are getting their refunds paid in full now and will not go through the Scheme of Arrangement. These are:
1. customers with a Final Decision from the Financial Ombudsman (FOS)?
FOS is a two-stage complaint service. The first stage is called an adjudicator decision. The second stage is from someone called an “ombudsman” and is called a “final decision”. If you have a Final Decision from the second ombudsman stage, this is legally binding and ICL will pay your refund in full.
2. customers who had an adjudicator decision from FOS that ICL accepted
If your FOS adjudicator has agreed with your complaint (for example saying “refund loans 5-12”), and ICL has accepted this adjudicator decision and you have accepted this adjudicator decision by July 31st, then this refund will be paid in full.
3. customers who were made a refund offer by ICL that they accepted before July 31
If ICL offered you a refund when you complained and you have accepted that already, it will be paid in full and you do not need to do any more. If you did not accept the offer, it is now too late to and your complaint will have to go into the Scheme of Arrangement.
All other complaints will go into the Scheme
Apart from the complaints that are going to be paid now in full (see above), all other existing complaints are on hold until the Scheme is approved.
This applies to complaints currently with ICL, including loans from the Money Shop, Payday UK and Payday Express. ICL will not be doing any further work on these complaints. If you are witing for a response, or have sent in bank statements as requested, nothing further is going to happen.
FOS will not now look at these complaints so there is no point in sending them a new complaint. FOS has stopped work on complaints already with it.
People who have not yet complained
If you send a complaint to ICL now, it will be on hold until the Scheme is approved. There is no hurry to do this and you will have to resubmit your claim after the Scheme is approved, so you may as well wait until then.
Do not let a Claims Company send in a complaint for you now. The procedure to submit a Claim will be a simple form, a Claims Company will do nothing but fill out your name and address.
How the Scheme will work
On August 9, ICL received court approval to call creditor meetings. It is now sending everyone an email with an Explanatory Statement with further details about the Scheme and how to vote. these started to go out on August 14.
The next steps are as follows. Each step assumes the previous steps were passed/approved:
- September – meetings of creditors will be held to vote on the Scheme. As a creditor you can vote online before 20 September or vote in person in Nottingham on September 24.
- After approval, customers who have not sent in a complaint will have 6 months to submit a claim.
- All claims will be assessed and if they are decided to be valid, a redress amount will be calculated. There will be some appeal mechanism.
- There will be c £13.6m available to be divided up between the successful Claims. How much you are likely to get will depend on how much interest you paid and how many people submit claims. If a lot of people make claims, you may only get a small amount, but if many people don’t bother it could be larger.
- Payouts are expected to be in late 2020.
I will be updating this article as there is more news. And the comments below show what other customers are thinking.
Did you borrow from other lenders?
This email from the money shop may the first time you have heard about affordability complaints or getting a refund of payday loan interest.
If you have borrowed from other lenders, you may be able to get refunds from them. read How to make a payday loan affordability complaint which explains all this and has free template letters that have worked for thousands of people.
Updated August 14
Refunds from Provident & other doorstep loans
Why the FSCS doesn’t cover payday lenders
More refunds for Amigo loans
Dean says
If you read the email it says an additional £20million available so that reads lntop of the original £18million originally planned. If I am reading that right we may actually an ok amount if the scheme goes ahead, it will 100% be more than if the scheme fails and the company liquidated as we will get zero
Sara (Debt Camel) says
I don’t think that is 20m on top of the original 18m…
Vanessa says
Hello,
I am somewhat confused as to what to do and I am hoping for some clarity. I got an email today asking me to vote on the scheme. This is the first I have heard about it. I had payday loans from The Money Shop and PayDay UK years ago and eventually paid them off after getting into a lot of debt. I do not live where I did when I obtained them and my mobile number has changed. Do I need to contact them to update my details? Do I need to send anything else?
Sara (Debt Camel) says
I suggest you don’t do anything for a while. There is no hurry. There is a LOT of paperwork to look through, then I will be writing an article on this and what people’s options are.
emma says
This was my email definitely says they have an additional 20 million sara
INVITATION TO VOTE: PROPOSED SCHEME OF ARRANGEMENT IN RELATION TO
INSTANT CASH LOANS LIMITED
We wrote to you on 19th July 2019 and sent you information about a Scheme of Arrangement
which we are proposing. If the Scheme is approved, we will have an additional £20 million
available to meet the costs of complaints from our former customers.
On 9th August 2019, the High Court gave us permission to ask people to whom we may own
money to vote on whether or not they would like the Scheme to go ahead.
We think we may owe you money because you previously took out a loan from us or one of our
other companies. If the Scheme goes ahead, we will ask you to submit a claim and, if we agree
that we should not have made you a loan or you have another valid complaint about a loan, you
will be entitled to a payment in 2020.
If you would like to vote for or against the Scheme, you must do so by 5pm on Friday 20th
September 2019.
Sara (Debt Camel) says
Yes, but this is not an additional 20 million over the 18 million which they talked about in their previous email.
emma says
Oh is it instead of x
Sara (Debt Camel) says
pretty sure it is …
Terry says
FYI
Just had voting form frim money shop, it was in my spam folder, results of vote expected September.
Loo says
Has anyone actually managed to get through to them on the 01903 number? I’ve been trying for over a week now and today I have been waiting for 3 hours and counting!!
Steve says
Hi, I was down for payment on the 9th and the money was in my account as promised. Sorry others are having a shitty time of it.
Loo says
Hi Steve, was that within the 28 days? How did you get them to confirm? 28 days was last Wednesday and I just can’t get through to a single soul to confirm what is happening! Pleased you got your repayment
Charlotte says
It’s 28 working days just so you know cause I asked this week as I accepted mine 22nd July they said it could take upto 30th August that’s when it’s been 28 working days, they only make payments on a Friday x
Ljc says
Hi Loo
I accepted offer on 12th July and I’ve been told to expect payment on 23rd
Charlotte says
That number no longer is in use you need to call 08003161414
Turtle says
80% would be nice.
Sara (Debt Camel) says
wouldn’t it … but is it likely? See https://debtcamel.co.uk/money-shop-80-per-cent-how-likelyund/
Kerry Taylor says
Is the right thing to do to vote for or against?! I have no idea!
Sara (Debt Camel) says
I’m busy writing a post on the “80% figure” at the moment. I suggest you wait for a while – there is no hurry!
Sara (Debt Camel) says
Here is my new article on the 80% figure: https://debtcamel.co.uk/money-shop-80-per-cent-how-likelyund/.
I think more infomration needs to be provided before people vote. There is no hurry, so you could wait a few weeks! the online voting deadline is September 20th
Stephen says
Hi
I had my complaint rejected by payday UK but was successful with one from payday express. I complained to ombudsman and got acknowledged but nothing more just before the administration story broke. Will I have to complain again or will it be like Wonga with a portal etc?
Thanks
Sara (Debt Camel) says
I think you will have to submit a new complaint after the scheme is approved. A new Claims Portal will be set up.
stephen says
Thank you for this
simon says
Hi Sarah,
I’ve had this email, but I have had successful claims go through the FOS for all 3 companies and had pay outs early last year, why would they email me and does it really concern me now? Should I vote of just not bother as I dont think they would owe me ny more would they?
Simon
Sara (Debt Camel) says
I think it’s unlikely you would get any more! I think they are just emailing every customer.
Tracey says
I’m really annoyed with FOS. I rang them in September with 3 pay day loan complaints over 6 years old – money shop, payday uk and express payday and was advised to send the bank statements to them which covered the 5 consecutive years of loans. This took me 3 months to scan. Eventually I completed sending all documentation in December. I then got a reply in June advising they were on my case. I also received a phone call 2 weeks before this happened to confirm they were being looked at. I did point out to them that they had received my paperwork 7 months ago and i had heard rumours of all 3 company’s going under so could they please make a decision and then this happened. Its not fair. I think because there was so much paperwork to go through, it kept being put on one side.
Dean says
Hi, if you ask the FSO you can put a service complaint in to a team manager, this in turn will mean they look at your case and if it is framed they took too long they can offer redress of post money as compensation. If you are not happy with the outcome you are then entitled to go to alter independent assessor who looks at complaints against FSO
Leesharratt says
I waiting over a year. For them to decide if to look at the loans over six years. They decided to. In this time. Money shop have all this going on and the fo refuse to go any further. Very annoying
Sara (Debt Camel) says
Unfortunately those timescales are not unusual. There was a huge backlog of ICL cases at FOS. I very much doubt your case was handled more slowly because there were a large number of loans. And even if there had been an adjuicator decison, ICL may well have rejected it and there would not have been enough time to get an Ombudsman decision.
GM says
I find a bit strange that I didn’t receive the original email sent in July and I didn’t get this one either, And have been checking my junk mail box! My complaint was upheld by the adjudicator, a few days before the original announcement.
Yvonne says
This is my predicament I havent got anything from ICL since the adjudicator upheld my complaint.
Charlotte says
Have you rang them I haven’t heard from them since I accepted so I called them and they said it would just go in within 28 working days. I accepted on 22nd July and they said it will be in by Friday 30th August as they only pay on Fridays
Yvonne says
Rang who?? FOS upheld ICl havent answered my case is best described as in limbo. I was unlucky re timing. But I have not had any emails at all re voting etc..
Sara (Debt Camel) says
Charlotte, it sounds as though ICL accepted your adjudicator decision, so it is being paid out.
Yvonne, it sounds as though ICL did not accept your decision – is that correct? Your adjudicator at FOS would know.
Yvonne says
Hi Sara yea that’s correct. Adjudicator sent response a week before announcement. So ICL ignored.
So looks like I’ve got to resubmit it again to scheme even though adjudicator upheld. Very very frustrating.
Stephen says
Hello,
I tried to make a complaint against Payday Express some time ago but failed as none of the contact details worked. Emails were bouncing back undelivered.
This seems to be good news for me as I can now pursue my claim, is this right?
However, I didn’t receive an email from ICL. Should I contact them? If so, using which contact details?
Sara (Debt Camel) says
it is a pity you did not pursue this issue earlier.
You can send in a complaint now, but it won’t be looked at because at the moment ICL, who owns the payday Express brand, is asking for approval for its Scheme of Arrangement as described in the article above.
If the Scheme is approved, then there will be a way for all customers to submit a claim for payment in the scheme. You will not get back the full amount of any refund that is calculated though.
Jono says
Hi DebtCamel,
I sent PaydayUK an email for a statement of borrowings, I received a reply today saying
“Thank you very much for your request for a Statement of Account/Data Subject Access Request.
We will have written to you or your client separately to explain that Instant Cash Loans Ltd is planning to go into a Scheme of Arrangement, which will set a process for considering and, where appropriate paying out redress for Irresponsible Lending Complaints. Given the current plan, we have limited resources to produce the documentation you have requested, we therefore ask that you only request this information where absolutely necessary, and instead encourage you or your client to make a claim in the customer portal when Live. This is likely to be after the Scheme has been approved at the end of September.
If you still believe you require a Statement of Account/Data Subject Access Request then please reply to this email.”
My question is, reply saying I would like my statement or wait and also when will I know the customer portal is live?
Any advice would be amazing,
Thank you!
Sara (Debt Camel) says
Why do you want this information? If it is for an affordability complaint, then as the reply to you said, there isn’t much point in it :(
If you are in dispute with a debt collector or something, that would be different.
Jono says
Hi,
I wanted to open a case with FOS about irresponsible lending so I wanted to get a list of the loans I had with them, then got this response.
Sara (Debt Camel) says
FOS will not currently look at at any Payday UK complaints. Can I ask if you used a template letter from somehwere else, as my templates for payday lon refunds do not ask for a SAR.
Jono says
The message I sent them said
“Dear Customer Services,
Could you please forward me on the statements in full of the 5 loans I took out with you please, so I can send these to the FOS.
Regards”
Purely because with the complaint regards LS, The FOS asked for copies of the statements of my loans with the interest etc
Sara (Debt Camel) says
OK, that was a sensible idea, but it has been overtaken by events as now FOS will not look at these cases.
Mark says
This may be a silly question, if I have complained and got my refund already from TMS, yet I am still getting the communciation on the vote and being told a payment is forthcoming, is this because I am still owed or because they havent worked out I ve been paid already ??!
Lou says
If I’m still paying off a loan from payday express to bw legal
Do I carry on paying them
Can I still claim
I did receive the email regarding voting
Sara (Debt Camel) says
Yes you can still claim.
You may though be one of the groups of people who are better off if the Scheme is not approved, but the company goes bust! So you may not want to vote in favour of it. It depends how the Scheme will handle “the right of set off” and how the administrators would, I will ask about this.