FIN.

BrightHouse to reimburse customers following FCA engagement

BrightHouse, a rent-to-own company providing household goods to customers on hire purchase agreements, has committed to pay over £14.8 million to 249,000 customers following engagement with FCA. In 2014, FCA had identified BrightHouse’s processes relating to lending application affordability assessment and collections did not always produce good outcomes for customers. In response, the firm has worked to improve these processes, identifying customers negatively affected and seeking to make amends.

Across 384,000 lending agreements, BrightHouse proposes redress for customers in two sets of circumstances:

  • Customers whose circumstances have not been assessed properly at the outset of the loan to determine whether they could afford it and may have had difficulty making payments. Customers who handed back the goods will be paid back the interest and fees charged under the agreement, plus compensatory interest of 8%. Customers who retained the goods will have their balances written off; and
  • Customers who made the first payment due under an agreement with the firm which was cancelled prior to the delivery of the goods. This first payment was not returned to all customers. BrightHouse will refund this first payment plus pay compensatory interest of 8%.

All affected customers will be contacted directly by BrightHouse, explaining any refund or balance adjustment due under the redress.

After FCA comments that BrightHouse “was not a responsible lender”, BrightHouse CEO Hamish Paton stated the firm’s “top priority” is reimbursement and that the firm is “absolutely determined this doesn’t happen again.”

 

 

FIN. Team