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الجمعة، 31 يناير 2020

Mis-sold Wonga customers will only get 4.3p back for every £1 they are owed

Mis-sold Wonga customers will only get 4.3p back for every £1 they are owed

People mis-sold loans by payday lender Wonga have been told they’ll only receive 4.3% of their compensation claim.

Emma Lunn Thu, 01/30/2020 - 10:12

Wonga’s administrators have started writing to the firm’s unsecured creditors stating the amount of compensation they will receive for mis-sold loans.

Administrators Grant Thornton said they would be paying a “first and final dividend” totalling £23,090,071.32, representing 4.3p in the pound on agreed creditor claims of £535,636,017.75.

A statement on Wonga.com said: “This is being communicated to all successful creditors on 29 January and payment of the dividend will be completed within a four-week period thereafter. Please note that the dividend you will receive will be significantly smaller than your claim amount.”

Wonga went into administration in August 2018 after a raft of mis-selling complaints. About 390,000 customers had an outstanding complaint about being mis-sold an unaffordable loan – such as one they couldn’t repay without falling further into debt or getting behind on bills.

It was decided that if a loan was unaffordable, customers could complain and receive compensation – called “redress” – from the administrators. The redress is a refund of the interest and charges on the loan plus 8% statutory interest.

But because complainants are treated as unsecured creditors of the firm, they only receive redress once all the secured creditors and Wonga’s staff have been paid what they are owed from the firm’s coffers.

The deadline to submit a claim was 30 September when Grant Thornton said it had received about 390,000 claims for refunds with a total value of about £460 million – equating to about £1,200 per claim.

Claimants were warned they would get "significantly less" than full compensation, but few expected to get so little. A typical £1,200 claim will result in a payout of just £51.60.

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