Rent-to-own firm BrightHouse says it will pay a total of £14.8 million in compensation to 249,000 customers for irresponsible lending.

The money is from 384,000 customer loan agreements which "may not have been affordable" and payments "which should have been refunded", according to the Financial Conduct Authority (FCA).

BrightHouse provides household goods to customers on hire purchase agreements and has 250 branches across the UK including in Lincoln, Boston and Grantham.

The company has been working with the FCA since 2014 after the watchdog identified the firm's lending assessment and collections processes fell short of its expectations.

The FCA said that the group "did not always deliver good outcomes for customers, particularly those who were at a higher risk of falling into financial difficulty".

BrightHouse has "identified customers that may have been treated unfairly where its processes fell short of FCA expectations" and has committed to "putting things right" for these customers.

Where customers were not assessed properly when granted a loan and found it hard to make repayments, BrightHouse will refund interest and fees plus award compensation of eight per cent if customers returned the goods.

And balances will be written off for those who kept the items.

"Responsible lending and the fair treatment of consumers, especially those in financial difficulties or who are vulnerable, are key priorities for us."