Amigo: The guarantor Amigo declares that it cannot resume its loans before 2021

The UK subprime lender had said it was preparing to restart lending as soon as possible, but revised that timetable due to ‘continuing uncertainty’ as the UK enters a second COVID-19 lockdown on the 5th november.

“We are fully aware of our responsibilities as a lender and the important role we play for millions of people in the UK who cannot get a loan from a traditional bank,” the company said.

Amigo said it had “turned a corner” in its handling of complaints, but the total number of complaints received remained at a high level for longer than expected.

It has strengthened its ability to handle volumes and has taken a robust approach to dealing with claims management companies (CMCs), including reporting concerns about the behavior of certain companies to the Financial Conduct Authority.

It now expects provisions to resolve those claims to rise from £116.4m in the first quarter to over £150m, resulting in a profit and loss charge of over £85m.

In the three months to September 30, 2020, Amigo paid approximately £47 million in repairs to customers. About 60% was settled through cash payments, with the remaining amount managed by adjusting loan balances.

(Reporting by Sinead Cruise; Editing by Dhara Ranasinghe)

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