Shares in Orchard Funding Group PLC fell over 37% to 20p after it revealed that its largest customer had gone into administration.
Orchard, which provides insurance premium finance, had lent around 80,000 customers of Nukula Ltd, which traded under the Insure That brand, a total of £16.7 million as of the end of June.
With this representing a quarter of its £66.8 million total unaudited lending book, Orchard said it is now "assessing the impact" of the administration and its ability to collect on the lending made to the customers.
The company, which said it will update investors on this matter in due course, has not enjoyed the best year, having taken a £500,000 provision in March after a fraudulent introducer put fake agreements into its system using someone else’s identity, a month after being one of the companies hit by the Financial Conduct Authority's review of the guaranteed asset protection (GAP) market.
In May, Orchard warned that it was mulling a delisting from AIM