The latest from the FCA on the Provident problem;
Today the Court sanctioned Provident’s scheme of arrangement (the ‘scheme’). The Financial Conduct Authority (FCA) has been clear that it does not support the scheme for a number of reasons, including the key concern that consumers are being offered significantly less than the full amount of redress they are owed.
We shared our initial views with the Court at the convening hearing on 22 April 2021. Provident subsequently made changes to its proposal, including deciding to wind down Provident Personal Credit Limited (PPC) meaning PPC will no longer continue in business.
Despite our concerns with the scheme, the FCA were conscious that the only likely alternative to the scheme was the insolvency of PPC. In that scenario, consumers would likely receive no redress, which was an important factor in our decision not to formally oppose the scheme in court.
We continue to have significant concerns about Schemes of Arrangement being proposed and used by firms to avoid paying customers redress and plan to consult on our approach to this in the Autumn. The firm remains under investigation for its conduct.
Solo-regulated firms should be regularly assessing the adequacy of their financial resources (both capital and liquidity) and report to us immediately if they determine they are, or will soon be, in financial difficulty. To understand our expectations, firms should refer to the FCA Finalised Guidance on assessing adequate financial resources.
We provide answers to questions consumers may have:
I think I am owed redress, what do I do now?
If you believe that you are owed redress from PPC, you may have a claim. Provident has a scheme website which will give you all the information you need in order to make a claim – https://scheme.providentpersonalcredit.com/
I have already complained to PPC/FOS, what do I do now?
If you have an unresolved complaint:
- with PPC where PPC acknowledged receipt of your complaint; or
- with FOS
then you will not need to resubmit details. Your claim will automatically be included in the scheme. However, if you are unsure you can re-submit your claim.
If PPC or the FOS previously rejected your complaint, but you think it should be reassessed, then you will need to make a claim through the scheme.
How much will I get and when will I get it?
If your claim is upheld, the Provident scheme will contact you with how much you are due. If you have an active loan from Provident your balance will be reduced by the amount you are due when a decision is made. If you do not have an active loan, or are due an additional amount if your active loan has been reduced to zero, the amount you are due will be paid to you when all claims under the Scheme have been assessed.
How can I make a claim?
You will have six months from when the Scheme becomes effective (expected to be at the end of August) to provide details of your claim through an online portal available at https://scheme.providentpersonalcredit.com/. You need to make your claim through the portal before this deadline. After the deadline you will not be able to submit a claim.
Should I still complain to the FOS?
If you are complaining about a loan made by PPC which falls under the Scheme, then No. You should make a claim through the Scheme’s online portal.
If you have a complaint about PPC that does not relate to a loan which falls within the scheme, you can still complain to PPC. If you are not happy with PPC’s response you can complain to the FOS.
In order to determine whether you have a claim which falls under the scheme or not please refer to https://scheme.providentpersonalcredit.com/.
Is the FCA going to take action against PPC?
The FCA has opened an investigation into PPC. Whether we take action against PPC and what that action is will be decided when the investigation concludes.
What to do if you’re in financial difficulty
Anyone who is struggling financially can get free and impartial advice from the Money Advice Service / Moneyhelper on 0800 138 7777.