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ICL / Money Shop Scheme ends

A first payment of 4.31p in the £ was paid in May/June 2021.

A second, much smaller payment of 0.65p in the £ is being paid on 14 or 18 January 2022.

If you do not receive this second payment, see below for what to do.

a second small payment from the ICL/Money Shop scheme

 

Background to the Scheme

This “Scheme of Arrangement” covers borrowers from the ICL brand names, Money Shop, Payday UK and Payday Express, who were given unaffordable loans.

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 wqs facing escalating costs and it was closing shops. Now the business is being closed completely because of the cost of these complaints.

A Scheme of Arrangement is a legal device which limits a company’s liability to its creditors. See What is a Scheme? for more details. ICL is using this to limit the amount it has to pay out in refunds on unaffordable lending.

The Scheme was approved by creditors in September and by the Court on 8 October 2019.

4.3% paid in May & June 2021

A claims page was published and all Claims had to be in by April 9 2020.

The Money Shop home page said:

  • We have calculated the final dividend amount and you will be receiving 4.31p per £1.
  • Where you provided us your bank details we will commence making payments from 24 May 2021.

These payments were made by BACS. People will be paid in batches, once or twice each week through to the end of June:

  • We are unable to let you know the exact date of your payment.
  • You will receive an email before we make your payment with your calculation and cash payment amount.
  • If you did not provide us with bank account details, we have sent you a cheque.

The following details come from the March 2021 Scheme report:

  • 182,566 Claims were received;
  • the uphold rate was about 85%;
  • the total compensation people should have got was c. £340 million – now people will only get a tiny amount of that back;
  • it is now too late to submit a Claim.

No tax is deducted from the amount paid so there is nothing to reclaim.

Second, smaller payment to be paid in January 2022

After the first payment ICL was still receiving some money eg from a VAT recovery claim. This is being distributed to customers who had complaints upheld in the Scheme.

This will be 0.65p in the £. That is 0.0065% of the total redress that was calculated in your case.

This second payment will be much smaller than the first. If you got £100 on May 2021, you will get about £15 extra now in January 2022.

Customers were told by email about this on 12 January. The payments will be made on the 14 and 18 of January – your email says which date you should be paid.

Only bank transfers are being made – cheques will not be sent for this.

This second payment will be the final distribution. ICL will be liquidated – the company will no longer exist.

Was your ICL debt sold to PRAC/BW Legal?

Where you still owe ICL a balance on the last loan, this has been “set off” against your refund.

An example:

  • you should have had a refund of £2500 and you still owed £1000
  • then your balance is cleared, leaving you now being owed a refund of £1500
  • you then get 4.3% of the £1500

If your last loan was sold to a debt collector, in most cases ICL has arranged for you to still have this set off.

The exception is if your loan was sold to PRAC/BW Legal. Here you have been left owing the debt to PRAC/BW Legal and were only paid 4.3% on the redress ICL calculated.

PRAC/BW Legal is offering to reduce some customers’ balances, but see No set off in a Scheme/Administration when debt had been sold? for how you can complain and ask them to write off your whole balance.

5% in all – that is a very poor outcome for customers

When the Scheme was proposed in August 2019, it was suggested people might get back nearly 80p in the pound.

My first thought when I saw the 80p in the £ estimate was “and pigs might fly“… see Will the Money Shop really pay 80% of your payday loan refund?

And that has turned out to be spot on…

In September it admitted that:

  • it has decided to include all loans over 6 years which may reduce this to c. 44p.
  • it has decided to simplify the assessment in favour of the customers, which may further reduce this to 27p.
  • if twice as many people apply for a refund, this may go down to 14p.

By February 2020 in the previous quarterly report, the scheme administrators were warning this could be less than 10p.

So about 5% (4.3p + 0.65p)  is a dismal outcome for customers.

Why won’t the FSCS help these customers?

The Financial Services Compensation Scheme (FSCS) covered people making PPI claims if their firm had gone bust.

But the FSCS doesn’t cover payday loans. This was a very poor decision by the FCA.

Customers of the Money Shop, Payday UK and Payday Express have been let down badly by the UK regulators. The lenders were allowed to carry on giving loans that breached the affordability rules for years. And now there is no backup compensation scheme for when a lender goes under.

Updated January 2022

News about the Provident Scheme

refunds from overdraft charges

Can you get an overdraft refund?

Refunds from large loans and car finance

Comments

  2. Lucy Heather Morley says

    Does anyone know who we need to speak too, to sort this out and let them know, not all of us have received our redress payments? Do we need to get in touch with the accountants, the courts??

    Surely we can go above to let them know they are ignoring us.

    • Sara (Debt Camel) says

      have you emailed them? there is no other option available. A solicitor, accountant or the court is HIGHLY unlikely to be able to help you here. This company will literally cease to exist in a few weeks.

  3. Lucy Heather Morley says

    Hi,

    Yes, I’ve emailed 3 times now and had no response at all. I might go back and look at past emails and see which 3rd parties are involved.

    See if that might help.

  4. Hayley Bradley says

    Hi, I am in same position…. emailed 3x, no answer or, acknowledment…. I hoping to hear tomorrow as, to me, it seems the way they work….. a deadline is a deadline… which on paper is 12am tonight….. a phone number would really ( really) help….fingers crossed 4 all of us!!!

  5. Hayley Bradley says

    IMPORTNT UPDATE
    I emailed them again today. i emailed – scheme@themoneyshop.co.uk and labelled it ‘Second Payment’ and i got an answer straight away asking for my unique reference number. I emailed it over. Got another answer straight away. Saying my first payment and second payment was made.

    I explained that i have sent 3 emails to the address stated in their email advising if payment had not been received and putting ‘No payment received’ in the subject line. I copied and pasted their email to me (including the date) and further copied all my emails to them (including the date)

    and I now get NO answer. I emailed again asking is this being investigated and still no answer.

    So it might be worth everyone that has answered this THREAD to send another labelling it ‘Second payment’ and including your unique reference number and see what happens.

    Sara – if we don’t get an answer from would it be worthwhile logging a complaint with The Financial Ombudsman before they actually close for good???

    • Sara (Debt Camel) says

      FOS has no jurisdiction over what happens in a Scheme. And anyway ICL is very soon not going to exist.

    • Lorraine scott says

      Hi
      I’m due £498 which they say I have outstanding for not settling my loan absolute rubbish robbers

  8. Marcia Thomas says

    Sara..This is a big rip-off. the courts should have let those crocks paid back every penny of our hard earned cash. My second payment £72.

    • Sara (Debt Camel) says

      I agree you have all be hard done by. You have been let down by a regulatory system that allowed these firms to sell unaffordable loans, against the regulator’s rules, for years without taking effective action to stop it. And the firms were allowed to get away with very bad complaint handling. And didn’t have to keep enough capital (money in the bank) to be able to pay refunds. And the regulator has not made any provision for alternative forms of compensation when a lender goes under – when a PPI firm went bust customers owed refunds were repaid in full by the FSCS scheme but that doesn’t apply to lenders – it is the FCA’s fault that the FSCS was not extended to lenders.

      So blame the FCA.

      Now there is simply no action you can take in the courts to get any more money.

    • Louise Brown says

      I didn’t get a first payment. When was that and what were the figures? Just got £22.35 in my bank on 18 January. Absolute joke.

  9. Hayley Bradley says

    Hi, my second payment has been received in my new account today!!! fingers crossed for the rest of you.

  11. Hayley Bradley says

    Hi Susan – I sent an email last Friday to scheme@themoneyshop.co.uk labelling the email ‘ Second payment’ My email got answered very quickly and the money was received today… Please do try!! it worked for me.

  12. Kim says

    I received my second payment this morning after complaining they paid in old bank account. Even though they confirmed they got new details way before payment date. Had to email 4 times but finally payment gone in.

    Good luck everyone :)

  13. Norma Rose says

    I have Emailed over my unike claim reference number today 24th January almost account number and sort code no response received yet

  15. Luke andrews says

    I have sent them so many emails, no reply I’ve done everything they said to do and nothing

  17. Matthew Pople says

    Still not received my payments from last year or from this year yet,the whole is a scam they think they doing every body a favor and told them so over the phone.

  20. Chris says

    I emailed Moneyshop three times BEFORE the scheme closed, following their advice to email scheme@themoneyshop.co.uk with “No payment received” as the subject of the email. I received no response. The liquidators have pulled a fast one here, limiting their payouts by literally ignoring customers’ emails. An absolute disgrace as the Scheme is now closed and many of us will never get this additional redress.

    I see this has happened to other people too. The FCA have let us down on so many levels here.

  21. MONTASIR says

    Didn’t receive any of my payment. Not even first one. Contacted them they said they paid which they didn’t. Then I’ve sent them my bank bank statements for the months they saying they paid to proof. After sending the email to them they went quite. Never replied me back at all

  22. Dave says

    Can I still lodge a complaint with money shop? If so who do I contact? I had many loans but did not realise I could claim back on them. Thank you

  23. anon says

    Hi Sara, I have q number of missed payments showing on my credit for Provident and PayDayuk Loans. The accounts/loans closed in 2021 (not paid by me).

    Provident closed Dec 21, missed payments May 17 – Dec 21

    Instant Cash Loans (PayDayUK) closed Sept 21
    missed payments August 17 – August 21

    I would like the missed payments to be suppressed, should I contact (not expecting a reply) those companies and request a default be added from third missed payment and then approach CRAs with the same? Thank you

  24. Emma says

    Hi I was wondering if you can help me, I just yesterday received an email off BW legal regarding paying back THE MONEY SHOP LOAN, I applied to them in regards to redress ect few years ago but claim they haven’t deposited any funds to myself.. and I wasn’t entitled to a refund now I’m stuck as what to do money shop say they never give me loans yet are wanting money back..

    Thank you

    Emma

  25. Emma says

    My analysis of your client’s complaint:
    Having reviewed your client’s account I can confirm that no funds were deposited to your client by The Money Shop.
    My Decision:
    Thank you for taking the time to provide your client’s feedback to The Money Shop, having reviewed your client’s concerns I can confirm that I am unable to uphold your client’s complaint on the basis that The Money Shop has never deposited any funds to your client.
    I hope you are satisfied with our response,

    Won’t let me post the whole letter

    • Sara (Debt Camel) says

      So that was via a claim company?

      Would this be a fair summary of your situation…

      “I have no knowledge of owing any money to The Money Shop. I thought I may have taken some loans from them years ago, but that the loans hed been repaid.

      I made a claim to their Scheme, but this was rejected with TMS saying they never gave me any loans (see letter attached) so I assumed I had been wrong and gave up.”

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