It’s not been the best of times for payday lenders in terms of survival. Only a few months ago Wonga went into administration and post pandemic that looks like others may follow suit. Sunny may well be the next of the payday lenders to go into administration and lead to thousands of claims for payments and compensation. Sunny, as a payday lender, is the trading name of Elevate Credit International Limited. Whilst Sunny has seen ups and downs over the recent months in terms of future outlook, Sunny is looking like it’s going to struggle to pay out on cases where it’s been perceived as being unaffordable by the FCA. Add in the budgetary restraints when trying to survive the pandemic period as a trading lender and things are not looking good.
SUNNY UPDATE: June 29th 2020 saw Sunny Loans officially enter the administration process. KPMG is the firm who have been put in charge of overseeing the process as administrators. There is update information on the administration process on the Sunny FAQ pages. This means Sunny customers claiming for non-affordability will likely have to follow the same process as when Wonga went into administration and the current Money Shop, Payday UK claims process. We should expect details over the next few months surrounding debts being sold and once I know the companies taking on the loan books I’ll update this page accordingly.
What’s the latest on the Sunny administration?
In a recent article in the Telegraph, the Texas-based company Elevate Credit blamed Covid pressures as a reason it was on the brink of administration. Whilst this is in no small part due to the current coronavirus pandemic, it’s mainly down to the regulatory clamp down on the payday lender marketplace. A plethora of payday lenders who have been judged to have given “unaffordable” loans have been kicking the metaphorical bucket. Why? Well, as the FCA and regulators have been upholding more and more claims, this has, in turn, led to an increased number of payouts and payments due to customers.
Astonishingly, over three-quarters of those claiming that Sunny had given them an unaffordable loan have successfully been awarded payments. This has led over the last few weeks to a notice of intent being declared. This effectively gives sunny 10 days of protection from creditors.
Whilst the company has had recent positive news on its US side, it still looks unlikely to weather the storm. Should if crumple, it will be following swiftly in the heels of similar collapsed payday lenders such as QuickQuid, Wonga, Nextcredit, WageDay advance and more.
Are there any claims or payouts as part of the Sunny Loans administration process?
The UK arm of Sunny (Elevate Credit International Limited) is likely to give way to a Sunny claim or payout. With 75%+ being successful in their affordability claims and their customer loan book shrinking rapidly there ultimately seems no way out. The US arm of Sunny (Elevate Credit Inc.) has found a reasonable financial footing in the US, but the UK’s regulatory body, the FCA, have held their position on bringing payday lenders to account for irresponsible lending.
This is good news all of those unlucky enough to have stepped into loans that could have a representative APR of above 1000pc! Therefore, even though there’s likely to be delays during the administrative process, a Sunny refund or payment in 2020 is likely for most. The amounts for these payments will vary depending on the size of the loan customers had. During the administration process that will be repaid or passed on and the process of setting out claim payments will begin.
So what’s the very latest Sunny administration update and loans claim news in 2020?
When it comes to the latest Sunny loans update, we’ll need to keep our eyes on the 10 day period where the company is protected from creditors. The FCA will still be processing claim updates but there may be changes in payment timetables and dates due to the potential administration process. The rate at which the regulators are upholding claims with astonishing, more than most other lenders’ cases. Sunny Loans has repeatedly said FOS decisions are based on unclear guidance. However, this may be down to the three nature of the US payday market and them trying to apply that in the UK.
The next Sunny Loans update in 2020 is likely due when they move officially into the administration process. If it goes the way I’m thinking, this would be in the next week or so. Customers with Sunny loans with existing claims should continue to proceed with the claim process. Customers should also continue to make payments in order to keep a clean credit file. Those struggling with the loans can apply for an affordable payment plan as part of this process. In doing so, sunny should apply a stop to changes and interest during this plan.
Ultimately, for now, if you think you have a loan with sunny that was unfair and not affordable submit a
Sunny claim straight away. Then, await the next update.