Everyday Loans: A Struggling UK High Street Lender
The UK high street lender Everyday Loans is struggling to stay afloat. The company, which provides short-term loans to customers with poor credit histories, has been hit hard by the economic downturn caused by the pandemic. As a result, the company is looking to restructure its debt by swapping it for equity.
The Everyday Loans Story
Everyday Loans was founded in 2006 and is based in the UK. The company provides short-term loans to customers with poor credit histories. Everyday Loans has been a popular choice for those who have been turned down by traditional lenders, such as banks and building societies.
The company has grown rapidly over the years, and by 2019 it had a loan book of £1.2 billion. However, the pandemic has had a devastating effect on the company’s finances. Everyday Loans has seen a sharp decline in loan applications and an increase in defaults. As a result, the company has been forced to restructure its debt.
Restructuring Debt for Equity
Everyday Loans is looking to restructure its debt by swapping it for equity. This means that the company’s creditors will receive shares in the company in exchange for their debt. This will reduce the company’s debt burden and give it more financial flexibility.
The company is also looking to raise additional capital by issuing new shares. This will help to fund the company’s operations and provide it with the resources it needs to continue to provide loans to its customers.
The Impact of the Restructuring
The restructuring of Everyday Loans’ debt will have a significant impact on the company’s finances. The company will be able to reduce its debt burden and free up more cash to invest in its operations. This will help the company to remain competitive in the short-term loan market.
The restructuring will also have an impact on the company’s shareholders. The new shares issued by the company will dilute the value of existing shares. This means that existing shareholders will see their stake in the company reduced.
The Future of Everyday Loans
The restructuring of Everyday Loans’ debt is a necessary step for the company to remain viable. The company is hoping that the restructuring will help it to remain competitive in the short-term loan market.
However, the future of the company is still uncertain. The company will need to continue to invest in its operations and find new sources of capital if it is to remain viable in the long-term.
Conclusion
Everyday Loans is a UK high street lender that provides short-term loans to customers with poor credit histories. The company has been hit hard by the economic downturn caused by the pandemic and is looking to restructure its debt by swapping it for equity. This will reduce the company’s debt burden and give it more financial flexibility. The company is also looking to raise additional capital by issuing new shares. The restructuring of Everyday Loans’ debt is a necessary step for the company to remain viable, but the future of the company is still uncertain.