Thousands of Amigo Loan customers move closer to compensation
THOUSANDS of Amigo Loan customers are about to get their money back.
Amigo has been accused of providing unaffordable loans, which customers could not repay – but they are now closing in on the compensation they are owed.
Hearings were held on May 23 to approve the new business program that Amigo had planned to reimburse its customers.
Commenting on the outcome of the hearing, Gary Jennison, Chief Executive Officer of Amigo, said: “We are delighted that the Court has decided to give creditors the opportunity to maximize their Amigo relief payments.
“The Court’s decision is good news for creditors, customers and employees, and it brings us closer to compensation and allows us to put an end to the mistakes of the past.”
We asked debt expert Sara Williams, who runs consumer advice blog Debt Camel, what that means next.
She said: “Now that the court has approved the Amigo program, the next step is for Amigo to announce the start of the program and set up a page where customers, borrowers and guarantors can enter a claim.”
If a borrower is successful at that time, they will receive a portion of the interest they paid, which can be as high as 41%.
But most complaints will be about affordability, Sara explained.
She said: “An Amigo loan is only affordable to the borrower if, at the time the loan was made, the borrower was likely to be able to make all necessary repayments while being able to pay his other debts, bills and living expenses, without having to borrow my more.
“Many people will have been desperate to protect their guarantor, perhaps they got payday loans, increased their credit cards, or fell behind with bills to pay Amigo.
“So even if the Amigo loan was repaid on time, it may still have been unaffordable.”
Amigo warned last year that it could collapse under the weight of customer demands for refunds.
The lending company was founded in 2005, offering loans of up to £10,000 over 12 to 60 months at an interest rate of 49.9% to borrowers typically turned away from traditional lenders.
It would also provide loans to those with bad credit history as long as a friend or family member agrees to repay if they cannot.
But in March 2020, the company’s founder claimed customers had received “irresponsible” loans.
That’s what started the wave of claims en route to thousands of customers after this latest update.
But even if the program has been approved, customers will still have to wait for Amigo to set up a complaints page.
Once it goes live, they may only have six months to act according to Debt Camel.
You can still claim, even if you have repaid the loan, if you had trouble making the payment at that time.
If you always pay your debts, you can always complain if you have trouble paying the bundle of money.
To file a complaint with Amigo, you should contact us as soon as possible.
Send a short email to [email protected] with COMPLAINT in the subject.
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