29th October 2015
In the present day, it is difficult for people who are struggling financially to obtain money from traditional sources such as banks. CashEuroNet is a loan site that provide help to individuals across the UK who are struggling to fulfil their financial responsibilities. They are the parent company of two well-known loan sites called QuickQuid and Pounds to Pocket. These loan sites provide short-term loans and fast funding where the money is deposited into the customer’s account within 10 minutes o approval. The short-term loans allow new customers to borrow up to £1000 and existing customers to borrow up to £1500. CasshEuroNet pride themselves on being built on the principle of “providing trustworthy and reliable credit to consumers who need it most”.
Studies show that the consumer credit industry’s lax regulations have resulted in approximately 9 million people finding themselves in serious debt. The Financial Conduct Authority (FCA) have introduced new regulatory requirements which aim to reduce the level of consumers facing debts that they realistically cannot pay off. The payday lenders sector has been affected the most by these new regulatory requirements as they are the main sector to have created high levels of debt. In regards to CashEuroNet, QuickQuid and Pounds to Pocket, due to the payday loan companies poor affordability checking, 4000 customers found themselves to be in debt as they took out loans they could not afford to pay back. The loans did not meet the FCA’s enhanced standards. This lead to customers taking out more money to pay off previous debt which resulted them being burdened with more financial difficulties, thus introducing a vicious cycle of falling into debt by trying to get out of debt. CashEuroNet is expected to pay back £1.7m to 4000 customers. This is reported to be the FCA’s 3rd biggest fine to date. Payday loan sites are now required by law to carry out strict affordability assessments before lending money to customers. Nick Drew, UK Managing Director of CashEuroNet has issued a statement expressing that he is pleased that the FCA has reviewed their processes and that CashEuroNet do in fact take their regulatory responsibilities seriously. Nick Drew also went on to say: “We apologise to the 4000 affected customers, and we are pleased to be able to address this with the announced redress plan.”
CashEuroNet has made changes to its lending criteria which will now follow strict affordability checking. The payday loan company aims to complete the refund process between 60-90 days. There is no need for customers to contact the company as they will contact the affected customers directly as soon as possible. The customers will receive an average of £425 each.