Curo Transatlantic Limited (CTL), which trades as Wage Day Advance and Juo Loans, went into administration on February 25. KPMG was appointed as administrators to manage the firms’ businesses and affairs. KPMG have sold part of their loan book via a pre pack administration to Shelby Finance (trading as Dot Dot Loans), a regulated firm that provides home credit and short-term loans. Around 50,000 customers will be moved.
All of Curo’s current employees will become employees of Shelby Finance. The gross receivables (before any collection provisions), which exclude all the Curo bad loans identified by the company, amount to around £19m.
Paul Smith, chief executive of Morses Club, the holding company, said: “This exciting acquisition of such a well-established online lending business represents a significant escalation for Morses Club’s product diversification strategy.
“The range of online lending products that we will deploy through the newly acquired platform will exclude any form of payday style lending and the trading style will be dropped. The loan products will fit neatly within the existing Dot Dot Loans strategy, in terms of loan duration, affordability and forbearance.”
The Financial Conduct Authority (FCA) continues to supervise CTL and is in close contact with the KPMG to safeguard the interest of customers. The FCA added that it will engage closely with KPMG in respect of the loans which are not being sold.
KPMG has contacted affected customers to provide them with the relevant information and necessary contact details. KPMG has also updated the landing pages at both www.wagedayadvance.co.uk (link is external) and www.juoloans.co.uk (link is external).
In a statement the FCA added: “Customers should continue to make any outstanding payments as instructed by the administrators, KPMG. All existing agreements remain in place and will not be affected by the proposed administration. However, the firm is no longer able to issue new loans.”
So another lender goes into administration. The cause of the collapse is not known but there is intense competition in this area and some costs of running the IT infrastructure and the need to keep spending on marketing to hold on to market share is battering the sector.
Categories: What is administration