Provident Financial is hit for £20m as it rejigs its agents

Doorstep lender Provident Financial today revealed a £20 million balance sheet hit caused by an overhaul of its door-to-door salesforce.

The group is scrapping its army of 4500 part-time self-employed collection agents, who knock on doors offering loans and collecting repayments from customers, and replacing them with 2500 full-time iPad-wielding staff.

The shake-up will result in the one-off exceptional charge in the first half, including the costs of training recruits.

Provident, founded in 1880 to offer credit to poor people, hopes the new regime will lead to greater efficiency and better service for customers.

However, pushing through the overhaul is likely to lead to short-term pain. Repayments collected “in the field” will be hit, leading to a lower trading in home collection to the tune of around £10 million, it flagged in February.

Elsewhere the group is performing in line with City expectations. New accounts opened at Vanquis Bank, its main division, rose 45% to 122,000.

The shares, up nearly 10% over the past month, nudged down 1.1%, or 37p, to 3228p.