WageDayAdvance and Juo Loans go into administration leaving 650,000 customers in limbo over payday loans

TWO payday lenders have gone bust leaving 650,000 customers in limbo over what to do about their loans.

The struggling lenders WageDayAdvance and Juo Loans are both owned by the same parent company which filed for administration yesterday.

More than 50,000 Curo Transatlantic Limited (CTL) customers, including all Juro borrowers, have been sold to Shelby Finance, which is owned by Morses Club.

These customers will be notified that they have been transferred in the next few days and repayments should continue as normal.

But 650,000 customers - including those who no longer have a loan - will remain with CTL.

A spokesperson from administrators KPMG told The Sun that customers who make their repayments through an agent should continue to do so.

Borrowers who repay debts via a direct debit or other card payment won't be able to make payments while the administrators decide about what to do next.

In the meantime, all interest and charges will be temporarily frozen, although it's not clear how long for.

WageDayAdvance was processing thousands of compensation claims from borrowers who accused it of irresponsibly lending £18million in total, by charging rip-off interest rates and targeting vulnerable customers.

Ed Boyle, from KPMG, said that the sale of part of the business was the "best available outcome" for CTL's creditors given the circumstances.

He added: "Over time, and with the number of claims increasing, the financial and operational burden of resolving them became unsustainable.

"The Joint Administrators will now work to realise the remaining assets of the Company and to then distribute the available funds to creditors."

The firm's closure follows in the steps of Wonga which went bust in August last year for the same reasons.

Administrators are currently planning how to distribute the remaining funds, although it's still not clear whether there will be enough cash to payback customers who have already submitted a compensation claim.

KPMG has also confirmed that it will be contacting old customers who it thinks it might be owed cash and encouraging them to submit a complaint.

If the process is anything like what happened to Wonga customers, the firms will stop paying refunds immediately, including to those who have already been agreed.