Payday lender prepares for £18m compensation payout

The Nottingham-based owner of The Money Shop, the short-term loans company, is set to ring-fence some £18m which will be used as compensation for creditors, according to reports.

SKy News says that Instant Cash Loans (ICL), which owns The Money Shop, Payday Express and Payday UK, has been engaged in talks with the City watchdog for some weeks now nd is set to write to its £2m customers on Thursday this week to ask for support for its scheme of arrangements. If this gets the go-ahead, customers could receive payments if they can make a valid complaint about a loan they had with the company.

Sky News says the scheme of arrangement is likely to be voted on in September.

ICL stopped its loans business last August, but has been inundated with complaints ever since.

Last month, the firm wrote to its employees say the high volume of complaints meant the firm was “no longer viable”, putting 427 jobs at risk.

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