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, CashASAP,CashForUNow, Dot Dot, Fast Loan Uk, Fernovo, Ferratum, Kabayan, LoanPig, Mr Lender, Moneyboat, MyKredit, Smart Pig, Oakam, QuidMarket, Savvy, WageMe, Wizzcash,
See this email list for payday lenders for a longer list and all the 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.
- QuickQuid – read QuickQuid’s administration news.
Sunny, 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 is in a Scheme, Amigo is trying again to set up a Scheme
- other doorstep lenders 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
Tom says
wondering if anyone’s heard anything regarding myjar/harrisons? Ive chased them up a few times in recent months but keep getting the same template reply just saying they dont know when they will get round to giving me the verdict on my affordability complaint
Neil Sillery says
If the other companies are any indication, it will be another 12 months at least. Gotta run up those fees for the administrators.
Kirsty says
Hi Sara,
My case is with FOS and the adjudicator has recommended that the loan was unfair lending and I should get any interest +8%. I had paid off so much of the loan originally before defaulting and it was sold to a third party (Lowell). I’ve since paid a settlement figure to close account as I was wanting to apply for mortgage- is the lender likely to take into account the money I spent settling the case even though it was third party?
Thanks
Sara (Debt Camel) says
Yes, all the money you paid should be refunded. You should also have the default removed from your credit record by the lender and by the debt collector.
Peter says
I just had some success getting back £1800 in unfair overdraft interest from my TSB account. It was just a chancer thing.
So I then tried the same approach for my LLOYDS account that I swapped to TSB years ago.
Lo and behold. Just got £5000 approx back. I was in my overdraft for years and years and years. So basically having just got redress the overdraft was free for about 20 years.
Try it folks. It’s up to you.
Chris says
Hi Peter,
How long did it take with TSB as I have raised a similar complaint a few weeks back. Haven’t heard anything from them.
Cheers
Peter says
It was one week shy of their mandatory 8 weeks to investigate. I phoned them up to ask for update and later that day money was in my account showing as faster payment. Good luck.
Mel says
Hi, I have a similar complaint with HSBC! Sorry for stupid question but on what grounds did they uphold your claim and from when ?
I am just preempting them not upholding my claim, but I had loan, CC and OD that I couldn’t afford
Vicki says
How did you reach out to Lloyd’s? I have had crazy fees for unplanned overdraft payments and would like to try as at the time I was payday loan and credit card etc?
Sara (Debt Camel) says
read https://debtcamel.co.uk/refunds-catalogue-credit-card/. If you have been in your overdraft continuously for years (years not months) that is also a good reason to complain.
Nicola says
Hi Sarah
I had many payday loans with safety net credit and have a debt with them. That has been taken over by Lantern. Can I use the refund template and do I send it to lantern or safety net credit?
Thank you
Sara (Debt Camel) says
You send it to Safetynet credit as they made the poor decision to keep in lending to you.
What is the rest of your financial situation like now? How much do you owe Lantern and how long did you borrow from SNC?
CF says
Hi Sara,
Thanks for mentioning not to use Claim Management Companies – they just cost a lot and do not do anything beyond what your your free templates do.
Mike_p says
I used one for my first payday loan complaint before I’d come across this site, and have done all subsequent i=ones mysef. They are nothing but an email forwarding service, the only effect they had on my complaint was to slow down the correspondence between myself and the lender and I had to pay a large fee for the privelidge. It’s annoying to think I wasted momey on their fee but on the other hand if I hadn’t seen their advert it might mever have occured to me that I could complain.
CF says
I think you’ve made a great point that they raised a lot of awareness around payday loan complaints. It’s a shame they charge expensive fees for something you can do yourself. Now we have sites like Resolver.co.uk that are super helpful AND free. Good luck with your complaints!
Sara (Debt Camel) says
Of course payday loan firms (and CF is a payday lender, I just removed the name!) could be helpful and include links to Debt Camel or Resolver on their websites.
And they could remove misleading stuff about taking payday loans helping your credit score, while not mentioning that they cause huge problems for future mortgage applications.
CF says
In most cases, complaining directly with the lender is the easiest thing to do, but now resolver has taken the place of misleading claim management companies which is amazing progress. As for the impact on mortgage applications.. I wouldn’t know, I’ve never applied for a mortgage before and I’ve never heard of payday loans impacting mortgage eligibility….
Sara (Debt Camel) says
see https://debtcamel.co.uk/payday-loan-mortgage/
Paula says
Hello
Just wondered if anyone has had any success with making a claim against Quidmarket? I sent a claim 9 weeks ago which they acknowledged straight away and said they would respond within the 8 weeks but now on sending email chasing this up to the same email address getting no response
Thanks
Sara (Debt Camel) says
I suggest you phone them up and ask.
Margaret says
I raised an affordability complaint with TFS loans in March. They quickly told me as it was over 6 years they could not look at it. I complained to Ombudsman and after disagree with the investigator it had been sent to Ombudsman. The loan finished in June 2015. Yesterday I got an update on my credit report to say TFS had removed account from my file. I thought that would have been done long before this or is it because a complaint has been raised?
Sara (Debt Camel) says
The loan would normally drop off 6 years after any default date, or 6 years after the settlement date if there was no default date.
Debbie says
Hi can anyone tell me how long it took to receive payment into their bank once agreed on refund from safety net
Rose says
Once they’d asked me for my bank details, it took about eight days (including the weekend).
claire says
How long did they take to look at your complaint currently on just over 6 weeks
Debbie says
8 weeks and then 2 days for payment
Debbie says
It took 8 weeks exactly
Ruth says
Hi
If Morses say they can’t find any record of my account with Shopacheck is there anything else I can do or is that the end of it? I have no record myself as I moved house in 2019 and got rid of a lot of stuff as my last loan from Shopacheck was 2013
Laura says
Hi,
I don’t have the answer (sorry) but I am currently locked in a similar battle with Morse over a dot dot loans account. I used resolver to initiate the complaint and I’ve been hearing from Morse telling me they have no details (the last loan was three years ago). I’ve managed to locate a copy of my loan agreement in my emails so I have sent this back to them today.
Is it worth checking any old emails to see if you can locate any information that can help you?
Jack says
Hi Sarah,
I went through a bit of a rough time and have quite a few defaults on my Credit File. I’m going through them all now and asking for CCA’s and filing irresponsible lending complaints where I think there was irresponsible lending.
One particular default that I am unsure what to do with is Payday UK. The debt was bought by PRAC but under Equifax it shows the default reporting until December 2024 and under Transunion it shows the debt still being under PaydayUK and the default reporting until Dec2022.
I’ve just seen Payday UK are in a scheme of arrangement and they are not taking any future complaints. However, how do you rectify issues with your Credit File if the company is administration and not taking any future complaints?
Sara (Debt Camel) says
Did you make a claim to the Scheme? Was this your only loan from Payday uk?
it sounds as though the default date on Equifax and transUnion are not the same – do you know what these are?
James says
Hi Sara,
If I take out a payday loan but cancel it before the 14 day period does it stay on my credit report?
Sara (Debt Camel) says
I suppose you could argue it shouldn’t. It isn’t something I have come across.
Mike says
Has anyone had any update regarding 247moneybox?
Chris says
Hi Mike. I’ve not heard even a whisper from them since the original contact last year to give me my auto-generated redress figure, which I presume everyone else who was deemed eligible for compensation got as well. They haven’t even updated their https://harrisons.uk.com/247-moneybox/ website with any fresh info.
It’s saying the same thing and giving the same dates that are, in fact, now out of date, eg “further updates will be available in our next credit report which will be posted to our website will be posted by the 29th June”….blah blah blah.
We’re quite obviously well into September now and this has not been updated and their latest credit report was in fact published back on the 5th of July.
They really do seem to be giving us the run around here. 247moneybox is the only outstanding creditor redress I have left that has not yet been paid up.
I thought ICL were bad but even they finally paid up a few months ago and at least they made SOME contact in between, not much, however, their very occasional email updates were appreciated. But 247moneybox have beaten their “let’s keep them waiting as long as we can and not bother contacting them” record by a mile and I applied to both of them around the same time. Thanks.
Luke says
Hi,
Don’t even count on it. I got message back not long time ago with link and login details to Harrisons (Administrators) website and there is a document with costs etc.
There was ~ 13.7m from assets and so on, and “so far” costs related to administration 12.2m. What and wild wild west…
John says
I cant search for Lending Stream on the Ombudsman website. How can I lodge a complaint against lending Stream if they dont appear in the search box?
Sara (Debt Camel) says
Try Gain Credit, their company name.
Mike_p says
If you use their complaint form you can type anything into the name box:
https://help.financial-ombudsman.org.uk/help
Christopher taylor says
My case Is against Morses club/ shpoacheck for 6 loans taken out with them, at present it is with the ombudsman and the ombudsman have replied saying they have all the information regarding these 6 loans but state I had taken out 11 loans and are asking me for information regarding these other loans which I do not have. Morses / shopacheck are saying they they do not have the information on these other loans So I wonder where the ombudsman have got the basic information relating to these other loans from ,I wonder if anyone else out there has found themselves in this position.
Sara (Debt Camel) says
Are they earlier than the 6 you have records for?
Christopher taylor says
I presume they are .
Sara (Debt Camel) says
Then I suggest you go back and say that you don’t have any details on these loans, you assume they are earlier, but you would like the length of your borrowing taken into account when assessing which loans should be refunded.
This may mean that you don’t get a refund for the earlier loans but you get a refund for more of the 6 you do have the details for.
Dean says
Just received email from Peachy, the dividend is £4.6585 p
Payments to creditors are expected to be made on or before 30 September 2021.
ryan says
Hello
Two questions if anyone knows;
Firstly piggybank (DJS limited) have advised they have requested the loans to be removed from my creditfile but they are experiencing a delay in doing this. They have advised to contact request transunion to remove them myself. Has anyone had Experience in doing this and if so what did they do and choose for the reason?
Secondly with the payday loan refunds there is tax charge of 20% I saw people previously mention they got this refunded? Can anyone advise me on this aswell.
Thanks
Ryan
Tom says
Hi Ryan
I had the same thing with TransUnion and DJS because when I selected the reason it didn’t let me go further…
I emailed them instead at consumer@transunion.co.uk – it worked.
ryan says
Amazing, thanks Tom. did you just forward piggybank’s email?
Ryan
Xubo says
Just had an email with the figure of my peachy refund, £10, it’s so unfair when you think how much money these companies have had from us
John says
Hi everyone,
I had made a claim against peachy in 2019, they agreed to refund me £1,248.43, from which £973.64. is used to clear my debt with them, leaving a total refundable amount of £274.79. But this July i received and email from Peachy that they have appointed ACI Limited to manage my debt. Now today i received a calculation from Administrators, that i will receive a dividend from my £274.79 refund which is £12.80. The Question is – Whats is happening with the Debt of £973.64 which they sold to ACI limited? By initial agreement, that should be cleared Right?
Appreciate your help.
Sara (Debt Camel) says
Yes that sounds right. Ask the administrators to confirm this is happening.
Are you currently making any payments to this? If so, stop!
LH says
I had this question too! Thank you. I’ll stop the payments also
Hannah Martin says
Hey – I had a debt with ACI for Uncle Buck. Then UB agreed that it was unaffordable lending and wrote off the debt. I contact ACI who were actually really helpfel and very prompt and they did a check and the removed the debt completely from my file and their system. Contact ACI as my delaings with them was very good – specialistsupport@assetcollections.co.uk – That is their email incase you dont have it. Good Luck!
Nats says
Has anyone had an update from the administrators of Piggy Bank?
E says
Would be interested to know this also!!! As I have not either.
VG says
Hi Sara,
MyJar and 247Moneybox are both in administration MyJar since December 2020 and 247 since November 2019. They have not responded to my emails about an update on my claim in months.
I just want them removed from my file as it is about 10 of them. Do you know if they are still responding to CRAs – Is it too early to contact the CRAs to remove them, or should I wait longer?