The Standard has reported today that Investors in Amigo Loans, have “said a vast majority of customers have voted in favour of its plan to pay them lower compensation than they should have got.”
Similar to Provident, Amigo Loans are looking to introduce a Scheme of Arrangement, to settle customer complaints. Amigo has said that it unable to pay refunds to all customers who were given unaffordable loans, instead looking to introduce a scheme that will see customers receive around 10% of their anticipated refund value.
Over a million Amigo Customers have been contacted about the scheme, including current customers and all previous customers whose loans have been repaid. Today’s news, suggests that the majority of customers have voted in favour of the Scheme.
Amigo Loans is a UK based lender specialising in loans for people who are self-employed, have low credit scores, have County Court Judgments (CCJ) or who simply find it difficult to get a loan from other providers.
Amigo offer borrowers loans of £1,000-£10,000 over 1-5 years, with loans of under £2,500 available over terms of 1-3 years. One of their main offerings is a Guarantor Loan, where the responsibility for the loan is shared by both the customer and their guarantor – a friend or family member who would back the loan by agreeing to step in if the customer ever missed repayments.
Amigo Loans are looking to introduce a Scheme of Arrangement, to settle customer complaints. Amigo has said that it unable to pay refunds to all customers who were given unaffordable loans, instead looking to introduce a scheme that will see customers receive around 10% of their anticipated refund value.
A Scheme is a mechanism that will require customer and Court approval, to enable us to fairly and equitably receive and consider all claims related to loans made by Amigo. The purpose of the Scheme is to secure a better return for Amigo’s customers than would be possible if Amigo went into insolvency. Should the Scheme not be approved by customers, Amigo will go into insolvency and unsecured creditors (including customers with claims for compensation) would receive nothing.Source: Amigo Loans
If the scheme is approved, it would ensure that all customer complaints would receive something, however, it would not be the full amount that customers with a complaint are should receive. It is estimated that under the scheme, customers would receive 10% of what the original refund value under the scheme.
If the scheme is not approved, it is likely that Amigo Loans would be placed into administration or liquidation, resulting in no customer refunds or compensation.
If you have already made a claim to Amigo Loans for a mis-sold loan, or are a current Amigo customer, you should have received details of the scheme via email or letter. Amigo Loans have also set up a website with details about the Scheme: https://www.amigoscheme.co.uk/
In the meantime, whilst we wait for news on Amigo’s Scheme of Arrangement, either way, we will keep you fully informed and up to date.
If you have experienced being mis-sold another type of financial product, a Guarantor, Payday or Doorstep Loan, PCP Car Loan or Catalogue Card Credit, we can help. We want to help you get the compensation you deserve, before any other schemes pop up!
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