Payday lender Sunny brings in administrators
Payday lender Sunny has become the controversial sector’s latest casualty as it collapsed on Monday as the coronavirus dealt a final blow to the already struggling company.
The UK branch of Elevate Credit, which trades as Sunny, said it had asked administrators at KPMG to take over as it was unable to continue.
On its way out, the company’s US owners hit out at UK authorities, saying their approach to the sector is unclear.
“Regulators in the UK were unable to provide clarity that would allow Sunny to continue and sadly, the consumers’ choice for the most safe and reliable short-term credit option in the UK has ceased operations,” said chief executive Jason Harvison.
“I would like to give my sincere thanks to all of our UK employees and the thousands of Sunny customers who trusted us over the years.”
Elevate said that the onset of the Covid-19 pandemic had “further complicated the environment”.
Sunny had previously been known as 1 Month Loan and Quid.
It has now stopped giving out any new loans, but borrowers should keep paying their debt in the usual way, Sunny said in a statement on its website.
It also warned borrowers to be weary of scams. Fraudsters have in the past been known to target customers of failed companies.
Sunny is the latest in a long list of exits from the controversial payday lender sector.
Critics have long accused the lenders of taking sky-high fees from vulnerable customers.
Wonga became perhaps the most high-profile casualty when it called in administrators in 2018.
At the time Wonga blamed a surge in claims that customers had been mis-sold the company’s expensive loans.
On Monday Sunny’s administrators said they would only pay out for mis-selling claims if there is enough money left over.
Since Wonga collapsed, it has been joined by several others, including WageDay Advance, Peachy, PiggyBank, Juo Loans and QuickQuid.
It is a trend that some in the sector have tried to cash in on. When QuickQuid closed its doors last year, Sunny posted a Q&A on its website to entice customers of the failed lender.