Did your payday loans cost so much when you repaid one you had to keep on borrowing?
You can get a refund of the interest you paid on unaffordable loans.
It’s easy to ask for a payday loan refund using the free template letters here. The letters work if your payday loans were repaid or if you still owe money.
This article covers everything you need to get started. It’s easy, free and many people are winning large payouts.
The comments below this article have thousands of stories of the refunds people have got using these letters. It is a great place to ask questions!
Contents
What are “unaffordable” loans?
Was a loan affordable just because you managed to repay it?
No! If paying a loan left you so broke you had to borrow again – from the same lender or a different one – it was unaffordable!
The regulator says:
“the borrower should be able to make the required repayments without undue difficulty, whilst continuing to meet other debt repayment obligations and reasonable regular outgoings.”
That means a payday loan is only affordable if you repaid it on time and you could still manage to pay your other bills and debts.
Payday loans are meant to be used to solve a short term problem. If you kept rolling a loan or repaying one then getting another loan soon after, the lender should have stopped lending to you.
If the loan was small and it was the first loan or second loan from a lender, the lender may not have realised the loan was unaffordable for you. But it was irresponsible lending to just carry on giving you more loans.
Many lenders ignored even very obvious signs of problems such as your loans increasing in size or borrowing very soon after repayment.
How much compensation can you get?
You don’t have to calculate this. Or work out which loans were unaffordable.
Just ask for a refund from the lender and see what you are offered. This is simple and it works well.
The Financial Ombudsman has seen tens of thousands of payday loan affordability complaints.
Payday loans are meant for short term problems and the lender should not have carried on giving you loans, A typical decision by the Ombudsman is that the payday lender should refund all the interest you paid interest after the third, fourth or fifth loan.
But if your first loan was large, or was rolled over several times you could get a refund from just one loan.
Which lenders can you get refunds from?
You can complain to lenders that are still in business, even if they have temporarily stopped lending because of Covid-19.
These include:
Lending Stream, Cash Converters, Fernovo, Ferratum, Mr Lender, Moneyboat, Smart Pig, CashASAP, CashForUNow, Fast Loan Uk, LoanPig, Kabayan, MyKredit, Oakam, QuidMarket, Savvy, WageMe, Wizzcash,
See this email list for payday lenders for a longer list and all their contact details to use.
Also use these letters for the very high-cost sorts of “flexible credit”, including:
SafetyNet Credit, Drafty, Polar Credit, Tappily.
If the lender has gone into administration, including Myjar, 247 Moneybox, Peachy, Piggybank, Swift Sterling, Uncle Buck:
- you can make a claim to the administrators – there is normally have a simple form for you to complete, see the lender’s website for details.
- you may not get much back but this is very easy to do. And if you win the complaint any negative marks on your credit record will be removed.
- Sunny – read Sunny goes into administration – what should customers do? for how you can put in a complaint
- QuickQuid – read What will happen in QuickQuid’s administration for how you can put in a complaint.
Wonga, Wageday Advance, the Money Shop, Payday UK, Payday Express and other lenders who gave up years ago – it is now too late to make a complaint about these lenders, see this list.
For longer-term loans there are better template letters to use on other pages:
- Provident,
- Amigo and other guarantor lenders,
- 118 Money, Everyday Loans and other high-cost large long-term loans.
First, before you send in a complaint
Doing these four things now will make your life easier later.
Get a copy of your TransUnion statutory credit report and keep it. After complaints are started, sometimes loans are deleted and you may want the full report if you later have to go to the Ombudsman. Don’t get an Experian or ClearScore report instead – many payday lenders don’t use those.
If you can log-in to the lender’s website and see your loans, take a copy of them as sometimes they vanish when you complain.
If you still owe money to the lender:
- unless you can afford to make this month’s payment without borrowing again, cancel the CPA to the lender at your bank. Otherwise the lender may take the money and you will be in a mess.
- read the Stop making payments? section in Payday loan refunds when last loan not repaid. If you want to offer a lower affordable amount, add a sentence to your complaint letter saying this.
- if you have a lot of borrowing at the moment, read Escape from the payday loan trap which looks at how a debt management plan can help you.
If your loan was sold to a debt collector you still complain to the original lender but also tell the debt collector that you are disputing the debt. Don’t skip this bit or a debt collector may go to court. It is a good idea to carry on making payments to the debt collector if they are affordable.
Start your complaint & get loan details
You can find the lender’s email address for complaints from this list.
Put “AFFORDABILITY COMPLAINT” as the subject of your email:
You should never have given me these unaffordable loans. I am asking you to refund the interest and any charges I paid, plus statutory interest, and to delete any negative information from my credit record.
[delete this sentence if you know what all your loans were.] I know the difficulties your loans have caused me but I no longer have all the loan details. Please send me a list, showing for each loan when it was taken out, how much interest and charges you added and what I repaid – this will enable me to assess any refund you offer me.
[delete this sentence if none of your loans were sold.]If a loan was later sold to a debt collector, please inform me of the date of sale and the name of the debt collector.
[Only put this bit in if some of your loans were more than 6 years old. This explains why you haven’t complained before. It ‘s only an example, don’t copy it, change it so it covers what happened to you!] [I didn’t know that the lender was supposed to check that I could repay the loan without having to borrow more. I only found out in 2020 when I saw a newspaper article in the Sun/an advert on Facebook for payday loan refunds/a friend said they had made a complaint/whatever.]
This email begins your affordability complaint.
The lender should reply to your complaint within 8 weeks from when you send the email, not when they acknowledge it. Make a note in your diary for 8 weeks time and chase the lender up if you don’t get a reply.
They may send the list of loans sooner, and then later send the response to the complaint, so don’t be surprised if you get sent info on the loans but nothing about your request for a refund.
Don’t be surprised if you have to wait until the end of the 8 weeks to get response. A lot of lenders are really slow.
When you get your loan information, you can send in more details about your complaint if you want. You don’t have to do this, your complaint has already begun and the lender has to reply.
I don’t know if many lenders actually read what you send them. But it’s easy to do – you don’t need to calculate what refund you should get or quote laws.
Change this template so it tells your story.
I have had x loans from you from [2015 to 2016].
Paying you each month left me with too little money so I had to keep borrowing to get through the next month.
For this period my take home pay was about £x a month.
[Include the following details if you know them, but if they varied a lot miss this out My living expenses were roughly: rent/mortgage £x. Council tax £x. Utilities and bills £x. Transport costs £x. Clothes £x. Food, toiletries etc £x. Child expenses £x Other debt repayments £x. Total £x per month.]
You should have realised from the number of times I borrowed that my debt problems were getting worse. It was not responsible to continue to lend to me. [Add more details eg how often you borrowed or rolled loans if you know them, how the amount borrowed generally went up etc]
[Include/change this if your credit record would have shown big problems: My credit reports would have shown all my other debts and problems including late payments/defaults /CCJs/debt management.]
You should never have given me these unaffordable loans. I am asking you to refund the interest and charges I paid, plus statutory interest, and to delete negative information from my credit record.
Some ways to improve this
Add any points that help you describe what happened to you. And delete any bits that don’t matter to you. Some examples:
- “I took out another loan with xxxx to pay you.”
- “Sometimes I borrowed to pay the rent and then had to top-up to get money for food.”
- If you weren’t treated fairly while you were borrowing add a bit about this.
Don’t worry that the lender will say you should have cut back on your living costs, just put down your normal expenses. You don’t need to include evidence about your expenses.
Send credit record and bank statements?
Some lenders ask you to send them a copy of your credit record, your payslips or bank statements. This is mostly to be difficult – the lender can check your credit record themselves if they want.
Don’t send payslips – they won’t help an affordability complaint and the ombudsman never asks for them.
Send bank statements if you want, but think twice about the cost of copying and postage if there are a lot. Most lenders seem to ignore them if you do send them.
Some people feel these are personal and they don’t want to send them to a payday lender. If you don’t want to send them, tell the lender you will send the Ombudsman any information that is needed.
Rejected or a poor offer?
If the lender rejects your complaint or offers you a small amount, don’t be depressed. You may still have a very good case!
It is easy and free to send your case to the Financial Ombudsman where many thousands of people have won their payday loan complaints, despite being rejected by the lender.
Give up?
Some lenders try to make your case sound bad when it isn’t. People have had large amounts refunded after a complete rejection!
Just ignore any of the following comments, they do not mean you have a weak case:
- they relied on your loan applications and you didn’t give the full facts – see Lender says I lied for more about this;
- you repaid some loans early – this doesn’t prove the loans were affordable, just that you were trying to save interest;
- your borrowing didn’t go up every time – irrelevant, what matters is that you kept borrowing;
- you had a good enough credit score or they didn’t legally have to check your credit record;
- your loans are over 6 years old – the Ombudsman will look at these even if the lender says they won’t!
Will a lender improve an offer?
You may be wondering if you should go back and try to get the lender to give you a better offer. Most lenders won’t do this, but a few may if you make out a good case – this includes Mr Lender and SafetyNet Credit. For example if they have offered to refund loans 6-12 you would be happy if they included one or two more, you can say why you think loans 4 and 5 should also be refunded.
A good enough case to go to the Ombudsman?
If you don’t know what to do, ask in the comments below this article. Accepting an offer settles your whole complaint – you can’t change your mind later.
Don’t worry that you will lose a small offer by going to the Ombudsman – this doesn’t happen.
Some points to think about:
- if you are offered a refund on only a few loans, don’t accept if you think you paid a lot more than that in interest. Some lenders offer a few hundred pounds to people who get ten or twenty times as much from the Ombudsman.
- an offer to write off your current balance may sound good … but it may be very poor if you should get a refund as well, see Refunds when you have a balance owing for details.
- if getting defaults or late payments removed from your credit record is important to you, are you happy with what the lender is proposing to do? Don’t assume your credit record will be cleared if the lender didn’t mention this.
One or two loan cases are hard to win at the Ombudsman. It’s probably best to give up on one or two loan cases unless:
- the loan was rolled or topped up several times; or
- the loan was large. Here is a single MyJar loan case that was won even though it was an instalment loan and the borrower had a good income because it was for £3,600. And a single loan Sunny case for a loan of £1,000. You can win cases for smaller amounts if the repayment would have been a large amount of your income; or
- you still owe money.
Don’t delay too long – there is a 6-month time limit after a lender rejects your complaint to send the case to the ombudsman.
How to send a complaint to FOS
Put in a separate complaint about each lender.
Don’t wait until all your lenders have replied before sending the first one to the Ombudsman!
One reader said: They couldn’t be any nicer. Caroline Wayman, the Chief Ombudsman, says:
It’s really OK to phone up and say, ‘I don’t think it was fair.” It’s not court; you don’t have to turn up with your ‘heads of claim’, you don’t have to write a fancy letter. Tell us your story and we will do the rest.
FOS’s “complain online” option is easy and takes you through your complaint step by step.
You can just copy what you said in your complaint to the lender. Add more details, for example, if you disagree with what the lender replied to you. Include a paragraph about having only just found out you could complain if some of the loans are more than 6 years old.
Things to attach:
- the reply you have had from the lender.
- bank statements if you have them. Ideally from 3 months before your first loan until the last loan was repaid or you defaulted on it. This strengthens your case, showing how unaffordable the loans were. You can still get bank statements even if your account is closed – if you don’t have them, start the process of getting them now, don’t wait until FOS asks for them.
- a copy of your TransUnion Statutory credit report.
What happens after you have sent a case to FOS
You will normally be contacted within a couple of weeks and asked for a copy of your credit record and your bank statements if you haven’t sent these. If you have sent these on one complaint, then when you complain about a different lender they will use the ones they already have.
After this initial contact, your case will wait for the lender to send FOS your case file and then wait to be picked up by an adjudicator who will make a decision on it.
If you are still making payments to the lender, tell the lender you want to reduce these to an affordable amount. This will make waiting for an Ombudsman decision much less stressful for you.
The Financial Ombudsman has a two-stage process. Most cases are settled by the first “adjudicator” stage but about 10% go to the second “Ombudsman” stage.
A few problem cases
Don’t ask for a refund:
- if you are bankrupt now or have been bankrupt in the past – any refund would go to the Official Receiver.
- if you are in an IVA, as refunds will go to your IVA firm not to you. If your IVA has finished the refund may still be sent to your old IVA firm.
- if you are in a DRO now, getting a refund may mean your DRO is cancelled!
More help
You can ask a question in the comments below – you may get a reply from someone who has been in your exact situation.
If you need help to complain, go to your local Citizens Advice, they will help for free.
Don’t use a claims management company. They are expensive and often incompetent. It’s easy to do this yourself and you can ask questions below and get replies from other readers who have done this.
Ask for a refund for large bad credit loans
Will you get a refund from Mr Lender?
How to complain about a guarantor loan
Emily says
Does anyone have any info about the “queuing “ system with Lending Stream? I am seeing lots of final decisions going out for complaints sent in after mine.
Jon T says
Hi Emily,
Same as me haha, was hoping to hear back by now based on comments i have seen. Now seeing comments from people getting final decisions who’s claim was sent in later than mine. (fair play to those people and best of luck everyone else).
Would be interesting to know how lending stream prioritise/manage the complaints.
Emily says
It’s so frustrating …. and yes I am pleased for others just want a decision, mine is only a small number of loans. Not sure if that makes a difference. Just want it over with. Hope you hear soon!
James says
I’m in the same boat, put claim in on the 26th May, and seems others have already heard back, guess I need to be more patient, waiting on Lending Stream, Safety Net and Mr Lender .Although Mr Lender were the worst to deal with.
Sara (Debt Camel) says
It is pretty normal to have to wait 8 weeks for a reply.
Jon says
I will update on this thread when I receive any communication from Lending stream. Date of complaint lodged was 26th May.
Cazza says
Just heard back from my Onstride Appeal and they have agreed that the loans were unaffordable. I’ve just got to wait now to see what the next step is as I have an outstanding balance with them. Has anyone else had any experience?
Chris says
Hi all, has anyone much luck with Saftey Net Credit and if so how long do they take?
Thanks in advance
Emilie says
Hi Chris. I raised a complaint with safety net credit in April, they contacted me within 4 weeks and said they needed longer but will reply before the 8 weeks were up. They issued their final response 2 days before the 8 weeks and they upheld my complaint. Was very surprised that they deemed all loans with them unaffordable. I think I had around 15 or so loans with them. They offered me £200 more than I expected so again I was very surprised. I had to email them my bank details and my refund was in my bank account 2 days after I received my response!
Ronald says
Hi Chris
Yeah I did. They took two weeks to acknowledge my complaint and then another two weeks before they gave me their assessment. They agreed with my complaint and I thought I would get something between£200 and £250, however to my surprise they offered me £497, which I accepted as I felt it was a pretty decent offer.
I placed my complaint before the pandemic hit, so I think I was quite lucky in their response and decisions times.
Dave R says
Took 5 weeks. Upheld my complaint. Refund in bank account was with me after 7 working days. They were easy to easy with. Refreshingly pleasant experience and didn’t low ball me or try and rip me off with what they offered. Good luck!
CHRIS says
Oh that’s great to hear that they seem to be fair. Because of this site I sent them a compliant to them about 3 weeks ago and they sent me a transaction history showing interest of nearly £3k that I paid. I’ve not heard anything since so i guess it might take another few weeks.
Thanks all for your responses. Fingers crossed for all of us waiting.
James says
Hi Chris,
Do you mind me asking how long you were have been using them, as I am waiting to hear how much interest I have paid, shockingly I have been using them for 5 1/2 years.
Kate says
James, you can see all your statements in the dashboard of your account – and download them from there. I was able to do this even though it was about 18 months since I had defaulted with them. I was using them for nearly 5 years myself: I felt physically sick when I totalled up how much I had paid in interest in that time :-(
siobhan says
Hi Sara,
I have lodged an unaffordability complaint with Drafty, using the email complaints@drafty.co.uk which I got from this site. I haven’t even had an my email acknowledged. When I took out these loans, they were part of Lending Stream, should I be complaining to them instead? If I don’t get a response from Drafty what would you advise my next steps to be/
Thanks in advance
Sara (Debt Camel) says
how long ago was this complaint sent?
Drafty and Lending Stream are brand names of Gain Credit
Siobhan says
Hi Sara, I sent Drafty the complaint email on Monday 7th June
Sara (Debt Camel) says
oh that’s very recent – I would ask then after a month confirm that they have your complaint. They have 8 weeks to respond.
Siobhan says
Will do, thanks Sara
Nikki says
Hi
Can I make a claim against any of the below?
Cheque centre, wage day advance, think finance t/a 1 month loan or instant cash loans??
What if the have been bought by a debt collection agency?
Thanks
Nikki
Sara (Debt Camel) says
No luck with any of those.
Cheque Centre and Wageday Advance have been dissolved.
ICL currently has a Scheme running but it is not too late to submit a claim.
Think Finance / 1 month was a brand name of Elevate credit, currently in administration and too late to submit a claim.
Chris says
Anyone got any more info on when 247Moneybox will be in touch? Last I heard it will be before the end of this month, is that still on?
John says
Hello Sara, thank you for help during these times, I find your website invaluable. I went through a bad patch a while back, single bloke, gambling, drinking too much and being a plain idiot. I got stuck in the payday spiral for a bit with far too many loans and found it tough to get out. I am think about putting a claim in, not for affordable as on paper I could afford them but for irresponsible lending. They didn’t really check me properly or ask for any info just kept approving my loans. Do you think based on my loan history I would win ?
23/07/2013 27/09/2013 £400
12/10/2013 24/12/2013 £300
30/12/2013 28/03/2014 £600
29/03/2014 28/07/2014 £600
28/07/2014 27/10/2014 £600
29/10/2014 27/01/2015 £700
29/01/2015 28/04/2015 £700
01/05/2015 28/07/2015 £900
30/07/2015 27/11/2015 £1,000
27/11/2015 26/02/2016 £1,000
09/03/2016 27/05/2016 £500
07/06/2016 26/08/2016 £600
06/10/2016 21/12/2016 £700
22/01/2017 28/04/2017 £200
15/07/2017 20/12/2017 £1,000
18/02/2018 25/05/2018 £250
16/11/2018 28/05/2019 £600
15/06/2019 27/03/2020 £600
Sara (Debt Camel) says
who is the lender? Has the last loan been repaid?
Paul says
Hi Sara,
sent Mr lender a complaint via email; i received in the mail a letter that if i wanted to pursue the complaint to complete a form with series of questions.
A couple of questions if you may kindly guide me how to answer them.
1) Please could you confirm as to why you believe these loans to be unaffordable
2) What would you deem to be a suitable outcome to your complaint?
3)Can i elaborate on the difficulties that were caused as a result of these loans
Once i send this information back they will conduct a full and thorough investigation.
First not sure why the send this via post rather than email as they would have gotten a quicker response. It feels like they are stalling
Sara (Debt Camel) says
They are being difficult. They have to answer your complaint even if you don’t reply.
Do you have a list of your loans?
They send by post as they are being difficult. Did they enclose a Stamped Addressed envelope?
Paul says
hi Sara
thanks for answering; no self stamp addressed envelope. they included a list of the loans
Sara (Debt Camel) says
So As I have just said to Daniel below this, the FCA says you have to be able to make a complaint for free. They cant use a phone line you get charged for calling – and so they should be requiring you to write to them and use a stamp!
I suggest you reply to them by emails, saying you are answering their letter dated dd/mm/yyyy and you don’t see whay you should have to pay for a atamp as they never sent you a pre-paid envelope.
The best answers to the questions are what happened to you. So for one person it could be (don’t just send this, it has to be right for you)
1) I remember the difficulty I had repaying the loans
2) I would like a refund of the interest paid on the loans plus 8% statutory interest
3) My debts were going up at this time as you would have seen if you had looked at my credit record.
But you can be more sepcific if you want. How many loans did you have? Did they tend to go up in size?
Daniel says
Hi Sara had the same reply off them via a posted letter but no pre- paid envelope so they are obviously being awkward but it’s fine il pay for a stamp
Sara (Debt Camel) says
noooo -the FCA rules say DISP 1.3.1A R These procedures must ensure that a complaint may be made free of charge.)
I suggest you send another email to the address you sent to before (what was it?) and say you are replying to the letter you have been sent as Mr Lender did not enclose a stamped addressed envelope and the FCA’s DISP rules say a customer has to be able to complain free of charge.
Also say you would prefer correspondence by email as your post is not reliable.
Have you been sent a list of your loans? If not, reply that you will be able to answer their questions when you are given the list of loans that you have asked for, but you note that Mr Lender is obliged under the DISP rules to respond to you complaint even if you do not give any further information.
Louise says
Hi all,how long do lending stream take to pay into bank once sent new bank details after agreeing settlement figure..🙂
Jon says
Hi Louise,
May I ask the time frame of you raising the initial complaint with lending stream to the date you got first settlement email please? I have raised a complaint with LS just trying to gauge when they will make contact.
Thanks
Sara (Debt Camel) says
They don’t seem to have a consistent timetable. It isn’t clear why – whether slower cases are more complicated, more likely to be rejected, involve debts that have been sold to a debt collector or if it is just random.
Louise says
Hi they took a couple of days after my initial complaint to send my loan information then about two weeks after to issue my final response,all very quick.
Jon says
Thank you Louise
Kelly says
Mine was in within seconds!
Kelly says
Hi Sara,
I emailed My Jar on 17/3 with an affordability complaint, they emailed me back on 18/3 and said they have forwarded to relevant dept. I received another email back and was told to contact Harrison’s. I emailed Harrison’s on 22/3 and 09/04, however I received nothing back from them. I emailed My Jar again on 13/05 for an update on my claim as I needed some sort of confirmation as to where I stand. They emailed me back on 14/05 to tell me there is no update and that the administrators are currently reviewing the claims made in the loan portfolio in accordance with recognised industry guidance to establish the potential sums due to claimants. We will be in contact when this process has been completed and when there is an update to give.
How long shall I give this? Shall I be patient and give it a few months? Is there a chance that I can get all the amount borrowed back or does it mean it will only be a partial amount when the administrators are involved?
Thanks,
Kelly
Sara (Debt Camel) says
The administrators said in February that any payout “was likely to be minimal”.