Amigo planning to start lending again by February 2023

Guarantor lender Amigo Holdings reported a slump in first-quarter customer numbers, revenue and profit, having been unable to lend since November 2020 after it was hit by mis-selling claims.

Amigo stopped lending nearly two years ago but the company said on Thursday that it plans to start lending again by late February 2023.

In update for the first quarter, Amigo said customer numbers slid to 61,000 from 118,000 in the same period a year earlier, while revenues tumbled 68% to £10.4m, reflecting the pause in lending and loan book reduction. Pre-tax profit declined 85.3% to £2.2m.

Chief executive Gary Jennison said: "We continue to engage positively with the FCA around our return to lending. This is the next step in our recovery, ahead of a proposed capital raise and would enable a new start for the business having taken on board the learnings from the past.

"Our new lending proposition, under the RewardRate brand, aims to offer a more affordable, responsible and flexible option to underserved customers who currently have very few choices. By allowing customers who make their loan payments on time to reduce their APR by up to 15 percentage points, we aim to help customers achieve a better credit rating and move towards cheaper credit. We believe fair and responsible non-standard lending choices are vital to creating greater financial inclusion and mobility."

At 1230 BST, the shares were down 9.5% at 4.98p.