Firm that cuts off customers' televisions if they miss payments to hand out £939k after regulator accuses it of unfair treatment

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Thousands of households that have bought electronics and furniture through a weekly payment scheme could be in line for compensation after a regulator crackdown. 

Dunraven Finance Ltd, which trades under the name Buy as You View, rents out items on hire purchase. This includes televisions that use a prepayment meter, which switch off if the customer misses a payment. 

Around 59,000 customers are due compensation payouts totalling £939,000 after the firm was found guilty of unfair practices. 

The regulator said the company did not set out its fees clearly to customers, it didn't treat customers who were in arrears fairly and the firm's assessments of customer's credit worthiness were not robust enough.

The hire purchase company has agreed to pay compensation to customers by the end of 2016

The firm, based in Bridgend in South Wales, has agreed to pay the compensation by the end of 2016.

A full rebate for failed direct debit charges will be paid out to 58,232 customers totalling £706,000 through a cheque or balance adjustment.

The fees charged when customers took out a refinancing agreement will also be returned and 1,610 customers will receive a split of £74,000.

These fees were usually between £30 and £45 for what was called a 'Fresh Start Refinance' plan and customers who paid these fees between November 2012 and March 2014, when they were removed, will receive redress.

Customers who paid one fee for multiple items rather than separate charges for each, which typically would have been cheaper, may also be in line for a refund. A total of 3,877 customers had these plans, which were called 'modifying agreements'.   

Those who bought items in this way may not have been aware they were paying more.

The firm says it will be getting in contact with these customers to see if these agreements, sold between 1 April 2014 and 1 August 2015, have caused them to suffer financial detriment and each customer will be treated on a case-by-case basis.

The company says it has made a number of changes to the way it operates.

The regulator says BAYV must compensate because it didn't treat them fairly or make fees clear

BAYV said in a statement it had been collecting payments via a prepayment meter since 1972, in a similar way to energy companies.

The meter is connected to the customer's TV and historically it was 'temporarily interrupted' when a 'suitable payment or arrangement' was made.

BAYV will continue this practise, however It has confirmed it will now issue a default notice at least 14 days before cutting off a customer's TV access if payments are missed.

From April 2014 the company stopped charging customers for refinancing arrangements and from 1 September 2015 it stopped applying fees when customers missed direct debit payments.

In October 2015 an 'independent Skilled Person' was appointed to monitor how the firm planned to address these complaints.

The hire purchase film used to cut customers off if they missed a payment on a TV agreement 

BAYV will start contacting those affected within the next two weeks so customers do not need to do anything and it has set up a page on its website giving further information to customers at www.bayv.co.uk/help/faq.

Jonathan Davidson, Director of Supervision – Retail and Authorisations at the FCA said: 'We are pleased that BAYV is working with us to address our concerns.

'It is important that firms meet our standards, including carrying out proper creditworthiness assessments and making sure that those in difficulty are treated fairly. We will continue, when necessary, to take action against inappropriate behaviour.'

Graham Clarke, chief executive officer at BAYV, said: 'We have worked closely with the FCA in recent months to address these issues and I am sorry to any of our customers who may have experienced difficulties as a result of us not achieving the high standards we set ourselves.

'We have gone further than the recommendations in the review by making additional changes to our operations. As we continue on our transformational journey, our aim is to be the most responsible lender in the sector.'