Mis-sold customers of Wage Day Advance and Juo Loans won't be given full compensation

CURO Transatlantic Limited (CTL), which owned Wage Day Advance and Juo Loans, went into administration on 25 February, and accounting firm KPMG was appointed as administrator.

An estimated £223 million of compensation is owed to customers who were sold loans that didn't meet lending standards. But KPMG has now said customers WON'T receive the full compensation they're owed, and are unlikely to see any payments any time soon.

See our Reclaim payday loans guide for how to check if you've been mis-sold.

I think I'm owed – how can I claim compensation?

KPMG says it is assessing each loan to see whether CTL complied with standards of affordability, sustainability and responsible lending when it was offered.

If these standards weren't met when the loan was agreed, it will be deemed an 'inappropriate loan' and you'll be due compensation.

• If you've been identified as being owed compensation, you'll be contacted by email and told how to make a claim. Some emails have already been sent out, while others will receive them over the next few days.

  Most will be contacted by the administrators, but KPMG says that a "small number" of customers whose loans were moved to Shelby Finance Limited will be contacted by Shelby directly.

• If you think you're owed compensation but aren't contacted, you can email the administrators to ask for a 'proof of debt' form, where you can provide details about your claim.

• If your contact details have changed, you can email the administrators' customer service with your new details and ask for any communications to be resent.

• If you'd already made a complaint before CTL went into administration, you'll be contacted "in due course".

How much compensation will I get?

KPMG has estimated the amount of compensation by adding up the total value of interest and charges you paid on each loan, plus 8% interest.

But if either CTL or the ombudsman said you were owed more compensation than this before CTL went into administration, this is how much you're due.

However, in practice the amount you're officially owed ISN'T the amount you'll be paid, as KPMG has warned that there won't be enough money to pay out compensation in full.

In its FAQs on its site, it said: "The exact timing and amount of such a distribution is not currently known.

"Unfortunately, as the companies have entered administration and have significant redress and other creditor liabilities, unsecured creditors with valid claims will only receive a partial payment of their claims."

In reality, the compensation you'll get will depend on how much money KPMG collects during the administration process, and how many people make claims.

How will I be paid?

If you're owed compensation, how you receive it will depend on the status of your loan: 

• If you have an outstanding balance with CTL, any compensation you receive will be subtracted from the amount you owe. 

  You'll still need to pay off the remaining balance in future, but if your account has remained with KPMG your fees and interest will be frozen. 

  If the compensation you're owed is worth more than your outstanding balance, KPMG says your balance will be provisionally wiped, and you can submit a claim for the remaining amount. 

• If you don't have an outstanding balance with CTL, you should receive a payment later on in the administration process, although amounts and timings are still undecided.

What does KPMG say?

A KPMG spokesperson said: "We are in the process of contacting Wage Day Advance customers with a potential redress entitlement by email with details of how to submit a claim and how to vote on the joint administrators' proposals to creditors.

"Some customers will see their loan balances reduced and others with no outstanding loan will need to file a claim for any redress they are owed.  

"We cannot yet calculate what fraction of their claim creditors will eventually receive, nor can we yet say when the payments will be made, but some funds will be available to those creditors that submit a valid claim."