Half a million people who were mis-sold loans by collapsed payday lender Sunny will receive just 1% compensation, administrators have warned.
KPMG said customers who were wrongly sold policies before the company went bust in June will likely lose out on any money owed.
The company, which is managing Sunny's collapse, said customers who are entitled to a payout should make a claim now.
However, it warned that the funds available mean that many may not receive a penny, or 1% at most.
It said those whose credit files were affected by the mis-sold loans would have their credit records cleared by November.
The first five missed payments will be removed from their files, with subsequent loans deleted entirely.
In June, Sunny became the latest high-profile payday lender to collapse on a back of an industry-wide mis-selling scandal.
An investigation found many of these firms - including Wonga and QuickQuid - were offering loans to people who would never be able to pay the money back.
Sunny, the brand name of Elevate Credit International Limited, fell into administration in June.
Administrators have since assessed Sunny's 700,000 customers and have concluded that 500,000 were mis-sold and could be entitled to claim.
These customers will be contacted in the coming weeks.
All claims must be submitted by the end of January.
"Whilst the dividend will depend on the volume of claims and queries received, we estimate that any dividend payable could be less that 1p in the pound and that any payment would likely be made in spring 2021," KPMG said.
