One of Canada’s leading providers of credit to consumers struggling to pay their bills sought bankruptcy protection as a result of its own excessive debt load.

CURO Group Holdings operates CashMoney and LendDirect in Canada, offering payday loans, installment loans and online credit. It filed for bankruptcy protection in late March, with plans to seek agreement with its creditors to reduce the company’s debt by about US$1 billion. In return, it would hand control of the company to its lenders.

About half of CURO’s revenues come from its Canadian operations. It also operates numerous lending firms in the United States. LendDirect is primarily an online lender, while CashMoney operates about 150 locations and employs more than 1,000 workers. Its operations continue while the bankruptcy proposal seeks creditor approval.

CURO had US$1.8 billion in assets and US2.2 billion in liabilities at the end of 2023. According to its financial reports, its Canadian operations have been more lucrative than its U.S. lending over the past several years.

CURO indicated its restructuring plan was supported by about three-quarters of its lenders, and that the bankruptcy restructuring would likely be completed within 120 days.

According to court documents, CURO struggled to transition to longer-term lower-rate credit products in place of its higher-interest products. CURO was sued by U.S. regulators in 2023 because of alleged churning of short-term loans into longer-term debt through repeated refinancing. CURO denied those allegations, saying the loans pre-date CURO ownership of the company that issued them.