High Court backs compensation for Provident customers

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Customers of doorstep lender Provident Financial can claim compensation for mis-sold loans after the High Court backed a partial repayment scheme.

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Customers will still not get all their money back.

However, the Court agreed to the scheme after the firm warned full payments would force it to go bust leaving many victims with nothing.

"We believed from the outset that the scheme was fair and that it offered the best outcomes for customers," said Malcolm Le May, chief executive officer of Provident.

He said the Court approval was "a positive outcome for customers with valid claims under the scheme, as it provides access to a redress payment which would not have been possible had the scheme not been approved."

The scheme will go live later in August with a deadline of the end of February 2022, giving borrowers just six months to claim their cash.

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Thousands of borrowers were deemed to have been mis-sold loans. But lenders such as Provident set up schemes which would see borrowers get a few pence for every pound due.

The Financial Conduct Authority agreed not to intervene because the firm said it was shutting its doorstep lending business. If its scheme did not go ahead, Provident said, customers get nothing.

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High Court backs Provident Financial's partial repayment scheme. Provident Financial customers can now claim compensation for mis-sold loans after the High Court backed a partial repayment scheme