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Malcom Le May has not had the easiest few years trying to turnaround embattled lender Provident Financial.
Today, however, he is feeling particularly emotional as the plug is finally pulled on its controversial doorstep lending arm - the backbone of the business initially founded 141 years ago to help Britain's poorest households make ends meet.
"It is a sad day because the doorstep lending business is part of the group's heritage - it means we're moving away from the original business formed back in 1880," he says. "I've got responsibilities to a number of different stakeholders, but today is clearly a very sad day for our customers and it's going to be a difficult period for our colleagues."
Provident's withdrawal from the market, which targets people who banks deem too risky to lend to, comes months after it admitted to a surge in customer complaints and warned the division could collapse unless compensation payments were reduced.
Many of the complaints centred around a lack of affordability checks carried out when doorstep loans and payday loans were granted.
Le May told investors on Monday that complaints driven by claims management companies had "become a real issue" for the high-cost, short-term credit sector.
The decision to walk away from the sector after 140 years collecting debts is part of a plan to become a "broader banking group to the financially underserved customer," the business said. It leaves 2,100 jobs at risk, with the unit to close unless a buyer is found.
"We just have to see what happens in the coming weeks," says Le May, refusing to say whether the company is in talks with any potential suitors.
Industry insiders say they do not expect rival Non-Standard Finance, which is run by ex-Provident boss John van Kuffeler, to swoop in with an offer. The business abandoned its £1.3bn hostile bid for the firm in 2019 after failing to win the support of key regulators.
John Cronin, a banks analyst at Goodbody, said the likes of Morses Club and NewDay could take a look "but I’m not convinced that either would transact".
"I suspect a few private equity firms will also consider an acquisition. However, I think there is a very real prospect of a managed run-down – which is ongoing anyway – as it may be difficult to secure a sale on satisfactory terms."
Whatever does happen, Provident said it expects to take a £100m hit for walking away from the division due to costs associated with redundancies, IT systems and office closures. Gary Greenwood, an analyst at Shore Capital, says that while the news will come as a blow to customers and staff, investors will rejoice as this "will lance a boil that has proven to be a source of significant financial pain in recent years".
Dubbed the Provvy, the Bradford-based business was formed in 1880 when insurance agent Sir Joshua Waddilove saw how families were struggling to pay for essential items so created vouchers that could be exchanged for clothing, food and coal. Agents would then go door to door to collect payments for the vouchers in weekly instalments.
It has since expanded into credit cards and car finance through its Vanquis Bank and Moneybarn arms, which both remained profitable during 2020. In comparison losses in doorstep lending rose to £74.9m for the year, from a loss of £20.8m the year before, dragging Provident as a whole into a £113.5m loss.
The closure of Provident's doorstep lending business means the company will now shift its focus further towards credit cards and car financing and away from a sector that critics claim exploits vulnerable customers who will never be able to repay the money they borrow and can be left saddled with high interest rates.
Earlier this year the City watchdog opened an investigation into Provident's doorstep lending unit, focusing on whether it followed affordability and sustainability rules in the year to February 2021.
However industry insiders fear that the likes of Provident withdrawing from the market means loan sharks could thrive as a growing number of people who can't borrow from banks are forced to turn to lenders or friends.
Looking ahead, Le May says it is too soon to forecast how the rest of this year will pan out for customers as the UK emerges from the pandemic and restrictions end.
"The prime banks have been releasing provisions but we've been slightly more conservative than that because our customer cohorts are, to the extent that there is a blip in unemployment, more exposed on a relative basis than a customer at Barclays or NatWest," he says. "Having said that, since the lockdown has started to ease, expenditure by our existing customers has started to show signs of recovery."