Amigo Loans was once the UK's largest guarantor lender. By 2024 it had ceased trading, paid out a fraction of what complainants were owed, and entered liquidation. This article sets out the timeline of what went wrong and what it meant for borrowers and guarantors.
This article is information only. It does not constitute financial or legal advice. If you need guidance on an outstanding claim, a debt, or a complaint, a regulated adviser or a free debt charity can help.
What happened to Amigo Loans?
Amigo Loans collapsed under the weight of unaffordability complaints. The Financial Conduct Authority (FCA) found serious failings in how Amigo assessed whether customers could afford to repay. A court-approved scheme of arrangement was set up to pay compensation, but the funds available meant claimants received only around 18.51 pence in the pound. The company entered liquidation in 2024.
Who was Amigo Loans and what did it do?
Amigo Loans was founded in 2005 and became the dominant player in UK guarantor lending. It offered unsecured personal loans to borrowers with poor or thin credit histories, provided a creditworthy guarantor (often a friend or family member) agreed to cover repayments if the borrower could not.
At its peak, Amigo had hundreds of thousands of customers and was listed on the London Stock Exchange.
The model worked by charging high interest rates to reflect the credit risk, whilst requiring the guarantor to act as a backstop. Borrowers who could not access mainstream credit saw Amigo as one of the few routes available.
What did the FCA find?
Amigo came under regulatory scrutiny because of persistent complaints that it had not carried out adequate affordability checks before lending.
Affordability checks matter because a lender is required to assess whether a borrower can realistically repay a loan without financial hardship. Critics argued Amigo's checks were insufficient, particularly for borrowers who were already in financial difficulty.
The FCA opened supervisory work on Amigo from 2019. By 2020, Amigo had stopped issuing new loans. The FCA's concerns centred on:
- Whether borrowers had been properly assessed for their ability to repay
- Whether guarantors had been given clear information about the obligations they were taking on
- Whether Amigo's complaint-handling processes were adequate
In 2023, the FCA announced it had concluded its enforcement investigation and referred findings for further action. The regulator stopped short of a public financial penalty given the company's insolvency position, but its censure was clear.
What was the scheme of arrangement?
Rather than go straight into insolvency, Amigo sought a court-approved mechanism called a scheme of arrangement. This allowed the company to put a formal offer to creditors and complainants.
Under a scheme of arrangement, a defined pool of money is set aside. All eligible claimants submit their claims. The total value of upheld claims is calculated, and each claimant receives a proportional share of what is available.
Amigo's scheme was contested. An initial scheme put to the courts in 2021 was rejected. The FCA objected that the terms were not fair to consumers. A revised scheme was approved by the High Court in May 2023.
Under the approved scheme:
- Customers with upheld affordability complaints were eligible to claim
- Guarantors who had complaints upheld were also included
- The payout rate was approximately 18.51 pence in the pound
- Claimants who had already received a county court judgment (CCJ) against Amigo were treated separately
The 18.51p rate reflects the stark gap between what complainants were legally owed and what remained in the company after costs.
What happened after the scheme closed?
Once the scheme of arrangement concluded and payments were distributed, Amigo had no remaining business purpose. The company did not return to lending.
In 2024, Amigo entered creditor voluntary liquidation. A liquidator was appointed to wind up the remaining affairs of the business, deal with any residual assets, and formally close the company.
This marked the end of Amigo as an operating business. Any claims not submitted within the scheme window were no longer recoverable through Amigo directly.
What did this mean for borrowers?
For borrowers who had a loan with Amigo, the key outcomes were:
If you had an upheld complaint: You received a payment under the scheme, at the reduced rate of approximately 18.51p in the pound. Any outstanding loan balance may have been reduced or written off as part of the settlement, depending on your specific case.
If you were still repaying a loan: Amigo's stop in lending did not automatically cancel existing loan obligations. Borrowers continued to receive demands. The scheme and subsequent liquidation changed how outstanding balances were handled. If any balance remained after the scheme, the liquidator's office would have been the point of contact.
If you missed the claims window: Once the scheme closed, new claims against Amigo were not accepted. The company's entry into liquidation ended the formal complaints process.
If your credit file was affected: A default recorded by Amigo will remain on your credit file for six years from the date it was registered, regardless of whether Amigo still exists. Checking your credit file with one of the three main credit reference agencies (Experian, Equifax or TransUnion) is a useful first step if you are concerned.
What did this mean for guarantors?
Guarantors faced a particular difficulty. If a borrower defaulted and Amigo pursued the guarantor for repayment, the guarantor may have paid money they later believed they were not legally obliged to pay, on the basis that Amigo had not properly explained the guarantee or carried out its own checks.
Where guarantors had valid complaints, those were included in the scheme. They were subject to the same reduced payout rate.
Some guarantors also found defaults or adverse entries on their own credit files as a result of missed payments. Those records may still appear on credit files depending on when they were registered.
What to check if you were an Amigo customer
- Your credit file. Check whether Amigo has recorded any missed payments, defaults or CCJs. You can request a statutory report from Experian, Equifax or TransUnion.
- Your scheme claim. If you submitted a claim under the scheme, the administrator's communications are the authoritative source for your payout status.
- Any outstanding debt. If a balance was passed to a debt collection agency before or during the wind-down, that obligation may still exist. The debt collector, not Amigo, would be the contact point.
- Free help. If you have concerns about debts that originated from an Amigo loan or guarantee, free services are available (see below).
Where to get free help
If you have concerns about debt linked to a former Amigo loan or guarantee, free, confidential help is available from:
- StepChange Debt Charity: 0800 138 1111 (freephone)
- National Debtline: 0808 808 4000 (freephone)
- MoneyHelper: 0800 138 7777 (freephone)
These services can advise on credit file queries, outstanding balances, and what to do if a debt collector is in contact.
Frequently asked questions
Did Amigo Loans go bust? Yes. Amigo entered creditor voluntary liquidation in late 2024 after its redress scheme paid out roughly 18.51p in the pound to eligible complainants. The company stopped lending in 2020 and never resumed normal operations.
Why did Amigo Loans collapse? A large volume of complaints alleged Amigo had lent irresponsibly without proper affordability checks. The cost of compensating those customers exceeded what the business could fund without becoming insolvent.
How much did Amigo customers receive in compensation? Under the scheme of arrangement approved in May 2023, eligible claimants received approximately 18.51 pence for every pound of upheld redress. Most received far less than their full claim.
Can I still make a claim against Amigo Loans? Once a company enters liquidation, the window for new claims is effectively closed. If you believe you have an outstanding claim, checking with the official liquidator or Citizens Advice is a sensible first step.
Were guarantors affected by the Amigo collapse? Some guarantors had also lodged complaints where they argued they were not properly informed of their obligations. These claims fell under the same redress scheme and were subject to the same reduced payout rate.
Are there still guarantor loan providers operating in the UK? The guarantor loan market contracted sharply after Amigo's difficulties. As of early 2025, the number of active UK guarantor loan providers is very small. The guarantor loans guide gives a broader picture of how the market stands.
Sources
- Financial Conduct Authority (FCA): enforcement and supervisory statements on Amigo Loans
- UK Government / Companies House: company registration and liquidation records for Amigo Loans Ltd
- Did Amigo Loans go bust?
Yes. Amigo entered creditor voluntary liquidation in late 2024 after its redress scheme paid out roughly 18.51p in the pound to eligible complainants. The company stopped lending in 2020 and never resumed normal operations.
- Why did Amigo Loans collapse?
A large volume of complaints alleged Amigo had lent irresponsibly without proper affordability checks. The cost of compensating those customers exceeded what the business could fund without becoming insolvent.
- How much did Amigo customers receive in compensation?
Under the scheme of arrangement approved in May 2023, eligible claimants received approximately 18.51 pence for every pound of upheld redress. Most received far less than their full claim.
- Can I still make a claim against Amigo Loans?
Once a company enters liquidation, the window for new claims is effectively closed. If you believe you have an outstanding claim, checking with the official liquidator or Citizens Advice is a sensible first step.
- Were guarantors affected by the Amigo collapse?
Some guarantors had also lodged complaints where they argued they were not properly informed of their obligations. These claims fell under the same redress scheme and were subject to the same reduced payout rate.
- Are there still guarantor loan providers operating in the UK?
The guarantor loan market contracted sharply after Amigo's difficulties. As of early 2025, the number of active UK guarantor loan providers is very small. Checking our guarantor loans guide gives a broader picture of how the market stands.