Moola was a high cost, short term lender. File image. Photo: 123rf
Payday lender Moola has gone into liquidation, after its parent company was placed into receivership.
A US venture capital firm, Partners for Growth (PFG), has appointed Rodewald Consulting as receiver of NZ Fintech Group Holdings and two associated companies to recover monies loaned, which in turn has led to the liquidation process for subsidiaries.
Tom Rodewald said PFG was a secured creditor, which had called up its money, although the amount owed was still to be confirmed.
"Subsequent to our appointment as receiver we placed 10 of the subsidiaries into liquidation."
Kieran Jones and Steven Khov have been appointed as liquidators of all the firms, which include Moola and another payday lender Need Cash Today, as well as vehicle finance company Zooma.
The high cost, short term lender Moola has run foul of the Commerce Commission and responsible lending rules in recent years.
In March last year it agreed to repay $2.8 million to borrowers after admitting it charged unreasonable credit and default fees.
In July, the Commerce Commission started legal action for alleged cartel behaviour in trying to control the price of online advertising on Google.
In October, Moola agreed to refund the interest and fees paid of 50 borrowers who were charged at annualised interest rates of up to 547.5 percent, after admitting in a settlement with the Commission that it breached the Credit Contracts and Consumer Finance Act.
It admitted not carrying out checks to see if consumers could repay the loans without falling into substantial hardship, failing to exercise care, and not ensuring contracts were not oppressive.
NZ Fintech Group's Christchurch based sole director and shareholder, Edward Recordon, was reported by the NZ Herald saying the parent company's problems stemmed from an equity deal falling over at a late stage in September.