Around 45,000 customers face financial uncertainty as HJS Recovery insolvency practitioners Shane Biddlecombe and Gordon Johnstone have been appointed to DJS, which traded as Piggybank.
As a result, all new lending activity has ceased although existing customers have been advised to continue their repayments for all outstanding loans in the usual way.
The lender, which was one of the UK’s 10 largest, was required by the Financial Conduct Authority (FCA) to carry out an assessment of its affordability processes.
PiggyBank offered loans of up to £1,000 to new customers for up to five months. Its customers would pay an interest rate equal to an annual percentage rate (APR) of between 1,255 percent and 1,698 percent.
A statement on Piggybank’s website said: “It is anticipated that the orderly wind down of the company’s business may, if applicable, include a sale of the assets of the company.”
The statement did not detail the reasons that led to Piggybank’s collapse. However, the high-cost, short-term sector has shrunk significantly over the course of 2019, following activity by complaints management companies and a crackdown by the FCA.
Currently, each case that the Financial Ombudsman Service (FOS) processes, including invalid claims, costs the lender approximately £500.
Complaints made to the FOS over high-cost, short-term lenders soared by 130 percent in 2018-19, according to its annual report.
Wonga, Curo Transatlantic, Instant Cash Loans have all collapsed over the course of 2019, while more recently, Enova – which owned QuickQuid, CashEuroNet and On Stride – announced its exit from the UK market.