The deep-seated rivalry between the UK's two biggest premium finance houses, Premium Credit and Prompt, surfaced openly this week when they accused each other of mud-slinging.
Premium Credit this week accused Prompt of hypocrisy because it is introducing contracts with brokers that are similar to the sole supplier arrangement deals used by Premium Credit.
The company points out that clauses insisting on certain volumes of business could have a similar outcome as an exclusivity clause.
The row follows last September's attack by Prompt on Premium Credit's contract.
“Being legally tied to a single supplier removes the broker's element of choice and defies the whole broking philosophy,” wrote chief executive Bob Golden, at the time, to his brokers.
Golden has now hit back in the latest spat by accusing Premium Credit of spreading “misinformation,” saying the new contracts are simply to overcome a technical difficulty inherited in the acquisition of the premium finance house Tifco last December.
“There was a ten-day period under the Tifco contract when the broker was liable for their policyholder's debt if they chose to pay by direct debit for the first instalment,” he said.
“We did not have this facility at Prompt, so we have extended the period to 17 days and asked only the 700 brokers inherited from Tifco to sign it.”
“Premium Credit is just running scared in the marketplace.”