Provident Financial
Encyclopedia
Provident Financial plc is a financial services group based in Bradford
, UK. It specialises in Home Collected Credit (HCC)
and also owns Vanquis which offers credit cards. It is listed on the London Stock Exchange
and is a constituent of the FTSE 250 Index
.
in 1880 by Joshua Kelley Waddilove to provide affordable credit to families in West Yorkshire
. The company's credit methods were rapidly popularised amongst the working classes, but from its outset The Provident was subjected to criticisms by those who were opposed to consumer credit or the costs associated with doorstep credit. The Company was first listed on the London Stock Exchange
in 1962. In 1997 it extended its operations to Poland
and the Czech Republic
, later operating in Slovakia
, Hungary
, Romania
and Mexico
.
In 2002 Provident Financial formed Vanquis Bank Limited, with a full banking license from the FSA, a consumer credit license with the Office of Fair Trading
and a license from VISA
International to operate and issue credit cards under the VISA brand. Vanquis Bank Limited specialises in the pre-paid credit card sector, enabling people to use the benefits of a credit card where normally due to their credit profile would seldom be successful in obtaining a card from mainstream card issuers.
In June 2004, the Office of Fair Trading
referred a Super-Complaint from the National Consumer Council expressing their concern over a perceived lack of competitiveness, particularly as the four largest operators accounted for around 70% of the business in the home-collected credit industry. The Office of Fair Trading published a consultative paper which echoed this concern about the concentration of market share and referred the case to the Competition Commission
.
Although the Competition Commission's conclusion confirmed high levels of satisfaction among customers who found home credit products well suited to their needs, they believed that measures should be implemented to make the sector more open and transparent. They required that the website Lenders Compared be set up, the costs of which was to borne by Provident and the other large operators. In addition, all home credit operators were required to advertise the new site in documentation and advertisements and to offer customers regular statements. The Commission rejected the concept of price caps, recognising that home credit is valued by many customers and did not believe that it would help customers if home credit were less available as a result and the potential of people then turning to unlicensed lenders (loan sharks).
In 2005, the company closed its Yes Car Credit division, which had sold second hand vehicles to customers with problematic credit histories via a national network of retail locations, offering the vehicle and finance as a single package. The company had been plagued by bad publicity, including a TV investigation into its selling practices, pressurisation of staff, unreliable vehicles and debt collection methods.
In 2007 it demerged and a new separate public company was formed called International Personal Finance
. This company now holds all of Provident Financials non-UK operations. It also sold the motor insurance business leaving Provident Financial to concentrate on UK only financial products.
and Greenwood Personal Credit
for its home credit operations, and Vanquis Bank for its credit card operation. Real Personal Finance became a trading style of Provident Personal Credit
, offering direct debit loans rather than the traditional home collected credit; the venture proved to be unprofitable and the RPF product was withdrawn in February 2010. The home lending operations are based in the head office building on Godwin Street in Bradford
and Vanquis Bank is based in London
with purpose built premises located in Chatham, Kent
.
The company's biggest business is lending to people in their homes via a network of local agents. Out of an estimated 3 million people who borrow from home credit providers, 1.8 million place their business with Provident Financial, giving the company an estimated 60% market share.
Bradford
Bradford lies at the heart of the City of Bradford, a metropolitan borough of West Yorkshire, in Northern England. It is situated in the foothills of the Pennines, west of Leeds, and northwest of Wakefield. Bradford became a municipal borough in 1847, and received its charter as a city in 1897...
, UK. It specialises in Home Collected Credit (HCC)
Moneylender
A moneylender is a person or group who offers small personal loans at high rates of interest.-See also:* Microfinance - provision of financial services to low-income individuals....
and also owns Vanquis which offers credit cards. It is listed on the London Stock Exchange
London Stock Exchange
The London Stock Exchange is a stock exchange located in the City of London within the United Kingdom. , the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement...
and is a constituent of the FTSE 250 Index
FTSE 250 Index
The FTSE 250 Index is a capitalisation-weighted index consisting of the 101st to the 350th largest companies on the London Stock Exchange. Promotions to and demotions from the index take place quarterly in March, June, September and December...
.
History
The Company was established in BradfordBradford
Bradford lies at the heart of the City of Bradford, a metropolitan borough of West Yorkshire, in Northern England. It is situated in the foothills of the Pennines, west of Leeds, and northwest of Wakefield. Bradford became a municipal borough in 1847, and received its charter as a city in 1897...
in 1880 by Joshua Kelley Waddilove to provide affordable credit to families in West Yorkshire
West Yorkshire
West Yorkshire is a metropolitan county within the Yorkshire and the Humber region of England with a population of 2.2 million. West Yorkshire came into existence as a metropolitan county in 1974 after the passage of the Local Government Act 1972....
. The company's credit methods were rapidly popularised amongst the working classes, but from its outset The Provident was subjected to criticisms by those who were opposed to consumer credit or the costs associated with doorstep credit. The Company was first listed on the London Stock Exchange
London Stock Exchange
The London Stock Exchange is a stock exchange located in the City of London within the United Kingdom. , the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement...
in 1962. In 1997 it extended its operations to Poland
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
and the Czech Republic
Czech Republic
The Czech Republic is a landlocked country in Central Europe. The country is bordered by Poland to the northeast, Slovakia to the east, Austria to the south, and Germany to the west and northwest....
, later operating in Slovakia
Slovakia
The Slovak Republic is a landlocked state in Central Europe. It has a population of over five million and an area of about . Slovakia is bordered by the Czech Republic and Austria to the west, Poland to the north, Ukraine to the east and Hungary to the south...
, Hungary
Hungary
Hungary , officially the Republic of Hungary , is a landlocked country in Central Europe. It is situated in the Carpathian Basin and is bordered by Slovakia to the north, Ukraine and Romania to the east, Serbia and Croatia to the south, Slovenia to the southwest and Austria to the west. The...
, Romania
Romania
Romania is a country located at the crossroads of Central and Southeastern Europe, on the Lower Danube, within and outside the Carpathian arch, bordering on the Black Sea...
and Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
.
In 2002 Provident Financial formed Vanquis Bank Limited, with a full banking license from the FSA, a consumer credit license with the Office of Fair Trading
Office of Fair Trading
The Office of Fair Trading is a not-for-profit and non-ministerial government department of the United Kingdom, established by the Fair Trading Act 1973, which enforces both consumer protection and competition law, acting as the UK's economic regulator...
and a license from VISA
Visa
Visa or VISA may refer to:* Visa , a document issued by a country's government allowing the holder to enter or to leave that country...
International to operate and issue credit cards under the VISA brand. Vanquis Bank Limited specialises in the pre-paid credit card sector, enabling people to use the benefits of a credit card where normally due to their credit profile would seldom be successful in obtaining a card from mainstream card issuers.
In June 2004, the Office of Fair Trading
Office of Fair Trading
The Office of Fair Trading is a not-for-profit and non-ministerial government department of the United Kingdom, established by the Fair Trading Act 1973, which enforces both consumer protection and competition law, acting as the UK's economic regulator...
referred a Super-Complaint from the National Consumer Council expressing their concern over a perceived lack of competitiveness, particularly as the four largest operators accounted for around 70% of the business in the home-collected credit industry. The Office of Fair Trading published a consultative paper which echoed this concern about the concentration of market share and referred the case to the Competition Commission
Competition Commission
The Competition Commission is a non-departmental public body responsible for investigating mergers, markets and other enquiries related to regulated industries under competition law in the United Kingdom...
.
Although the Competition Commission's conclusion confirmed high levels of satisfaction among customers who found home credit products well suited to their needs, they believed that measures should be implemented to make the sector more open and transparent. They required that the website Lenders Compared be set up, the costs of which was to borne by Provident and the other large operators. In addition, all home credit operators were required to advertise the new site in documentation and advertisements and to offer customers regular statements. The Commission rejected the concept of price caps, recognising that home credit is valued by many customers and did not believe that it would help customers if home credit were less available as a result and the potential of people then turning to unlicensed lenders (loan sharks).
In 2005, the company closed its Yes Car Credit division, which had sold second hand vehicles to customers with problematic credit histories via a national network of retail locations, offering the vehicle and finance as a single package. The company had been plagued by bad publicity, including a TV investigation into its selling practices, pressurisation of staff, unreliable vehicles and debt collection methods.
In 2007 it demerged and a new separate public company was formed called International Personal Finance
International Personal Finance
International Personal Finance is a leading British-based international home credit business. It is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.-History:...
. This company now holds all of Provident Financials non-UK operations. It also sold the motor insurance business leaving Provident Financial to concentrate on UK only financial products.
Operations
In the UK, Provident trades under a number of different brands, including Provident Personal CreditProvident Personal Credit
Provident Personal Credit Ltd is a financial services company selling loans in the United Kingdom and Republic of Ireland, a subsidiary of Provident Financial...
and Greenwood Personal Credit
Greenwood Personal Credit
Greenwood Personal Credit Ltd is a finance company supplying home collected credit in the United Kingdom, a subsidiary of Provident Financial. Their headquarters are in Bradford, West Yorkshire, and there are local Greenwood Personal Credit offices situated in towns and cities throughout the United...
for its home credit operations, and Vanquis Bank for its credit card operation. Real Personal Finance became a trading style of Provident Personal Credit
Provident Personal Credit
Provident Personal Credit Ltd is a financial services company selling loans in the United Kingdom and Republic of Ireland, a subsidiary of Provident Financial...
, offering direct debit loans rather than the traditional home collected credit; the venture proved to be unprofitable and the RPF product was withdrawn in February 2010. The home lending operations are based in the head office building on Godwin Street in Bradford
Bradford
Bradford lies at the heart of the City of Bradford, a metropolitan borough of West Yorkshire, in Northern England. It is situated in the foothills of the Pennines, west of Leeds, and northwest of Wakefield. Bradford became a municipal borough in 1847, and received its charter as a city in 1897...
and Vanquis Bank is based in London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
with purpose built premises located in Chatham, Kent
Kent
Kent is a county in southeast England, and is one of the home counties. It borders East Sussex, Surrey and Greater London and has a defined boundary with Essex in the middle of the Thames Estuary. The ceremonial county boundaries of Kent include the shire county of Kent and the unitary borough of...
.
The company's biggest business is lending to people in their homes via a network of local agents. Out of an estimated 3 million people who borrow from home credit providers, 1.8 million place their business with Provident Financial, giving the company an estimated 60% market share.