Over the past two years Amigo has received many complaints from customers. Most of the complaints were from customers that received loans that they believe they could not afford at the time the loans were given to them, due to the right affordability checks not being carried out.
We are using a legal process, called a Scheme of Arrangement (or Scheme for short). This is because Amigo cannot afford to pay all the compensation that we owe to customers with valid claims, and a Scheme will allow us to pay more money to customers than if we were to enter insolvency (or go bust) A Scheme is a compromise or an 'arrangement' between a company and its creditors, our creditors are customers that are owed compensation from us and the Financial Ombudsman Service, allowing the creditors to receive the best financial outcome.
A Scheme will allow these creditors (our customers and the Financial Ombudsman Service) to receive a fair and proportionate share of the total compensation available for their valid claim.
Update on the Scheme
The High Court has decided to allow creditors (our customers and the Financial Ombudsman Service) to vote on our two proposed Schemes of Arrangement, The New Business Scheme and the Wind-down Scheme, from 15th March 2022. For more information on the proposed Schemes and what they mean for customers, please see our dedicated Scheme website here.
Are Amigo refunding customers?
We have proposed the Schemes as we believe it will allow us to provide the best financial outcome (in the form of compensation, or ‘refunds’) to our creditors.
You may have a valid claim if you believe you were given an Amigo loan or stood as a guarantor for an Amigo loan when you couldn’t afford to make the repayments, at the time the loan was given. This applies to all borrowers and guarantors, past and present with a live or settled loan.
If the High court approves a Scheme you will be able to make a claim under the Schemes and these will be assessed individually. If your claim is proved valid you could expect to be paid in the second half of 2023 (likely beginning September). For estimates on the compensation you may receive from each proposed Scheme please see the Explanatory Statement within or legal documents here.
Who can vote?
If you believe you have a valid claim you are able to vote on the Schemes. You can do this right now by visiting our Scheme portal, if you haven’t already.
A valid claim means if you believe you were granted a loan or stood as a guarantor for an Amigo loan when you couldn’t afford to make the repayments, at the time it was given.
Should I vote on Amigo Schemes?
It is really important that you communicate your views on the proposed Schemes and have your opportunity to have a say in Amigos future, by voting. The outcome of the Schemes will affect all our customers that are owed compensation.
Amigo recommends borrowers and guarantors vote in favour of both Schemes. This will give a better financial outcome (in the form of compensation) for people with a valid claim than an administration. Voting in favour means you would vote ‘for’ the New Business Scheme and 'for' the Wind-down Scheme
How do I vote on the Amigo Schemes?
You will be able to vote now through our online voting portal up until 5pm on 10th May 2022. You can login to the voting portal by putting in your personal details which will verify that you are or were a customer with us. It’s really simple to vote, you just need to follow the online instructions. If you need any help, we have a team on hand to provide you with guidance and support.
When does voting end?
Voting will end on the 10th May. Until then you can: vote online on each of our new Schemes at www.amigoscheme.co.uk; register to attend and vote at the Creditors’ meeting to be held at 1pm on 12 May 2022; or appoint a proxy to attend and vote on your behalf at the Creditors’ meeting to be held at 1pm on 12 May 2022.
What If Amigo goes bust?
If Amigo goes into administration, an external administrator will take over the business. In this case, loans will not be written off and customers will still have to repay their loans, unless they have a valid claim that reduces their outstanding balance in full.
Following the end of voting and the creditors meeting there will be a Second Court Hearing on the 23rd May, this court hearing will see the High Court approve one of the Schemes or see us into administration. You will be notified either way. If the court approves a Scheme you will be able to start submitting your claim for a refund.
For more information, visit our FAQs by clicking the link here. Visit our Explanatory Statement here for more detailed information around the Schemes. For visual learners, we have videos available to explain the Schemes. Watch them all here.