payday loans

Dollar Financial UK, who owns payday loans company The Money Shop, has revealed millions of pounds in refunds is still owed to customers, and also that it has overhauled its operations.

Last October, the lender agreed to pay £15m in refunds to customers. However, only 25 per cent of these refunds have been paid back yet.

The remaining refunds will not be completed until the end of June, with £7m left to be paid out by the lender.

The Money Shop is undergoing significant changes, with a new revamped branch opened in Derby on Monday. It has also reduced the number of branches it has to 250, down from 600.

Chief executive Stuart Howard said: “The whole business model had to change. We have put our house in order,” describing how the company had been through “a tough 12 to 15 months”.

Although relations between the payday loans company and the Financial Conduct Authority (FCA) have improved, according to Mr Howard, the lender is still waiting to receive full consumer credit accreditation.

The payday loans market is much smaller after the FCA imposed new regulations last year, with lenders focusing on other financial products more, rather than just offering high interest, short-term loans.