LONDON, Aug 4 (Reuters) - British subprime lender Provident
Financial Group has been given the green light by the
High Court in London to pay partial compensation to customers
missold loans by its doorstep lending business as it closes it
down.
Provident said on Wednesday it had received a court judgment
sanctioning its scheme of arrangement, despite concerns raised
by regulator the Financial Conduct Authority (FCA) that it would
short-change customers.
The subprime lending industry, which lends to people who
can't get a loan from mainstream banks, has faced regulatory
scrutiny in recent years and a surge in claims from customers
alleging they were sold unaffordable loans.
Provident, which also offers credit cards and vehicle
finance, is providing a 50 million pounds ($70
million)compensation pot for doorstep lending customers to cover
partial refunds to anyone with a valid misselling claim.
The FCA said it had made clear it did not support the
scheme, adding the company remained under investigation for its
conduct. However it had previously decided not to oppose the
scheme in court because the only likely alternative was the
insolvency of the doorstep business.
Malcolm Le May, chief executive of Provident, said: "We
believed from the outset that the scheme was fair and that it
offered the best outcomes for customers".
($1 = 0.7187 pounds)
(Reporting by Iain Withers
Editing by David Holmes)
