Payday Lender Wonga Saw Losses Double In 2015

[mikey4444]

http://www.bbc.co.uk/news/business-36201486

Nice to see that these shysters are in financial difficulties ! I haven't seen their childish adverts on the TV for ages.

[Baldric]

"Representative 1509% APR"

Says it all really

[Cloverjo]

I can't say I'm sorry for them. Their representative APR is ridiculous. OH thought their ad was a joke when he saw it come up on the TV screen. 1000+%?

[ummmm]

These type of loans are okay if you really can afford to pay it back on time. The problem was they didn't care about that and were lending to people who could barely make ends meet without the added debt.

[ummmm]

Just seen on FB...

"Wonga declares £37.3m loss after accidentally borrowing a fiver from itself"

[Peter Pedant]

//"Representative 1509% APR"
Says it all really //

xc the bit where you explain how to make a loss when you are charging 1500% interest

[mikey4444]

Ummmm....very funny...well deserved BA !

Although the regulators are at last pulling their fingers out and tackling this shyster, Wonga should never have been allowed to start up in the first place. That high-end percentage rate is ludicrous.

Wonga exists because it can.

[Cloverjo]

If people dont have the money to pay it back, it doesn't really matter to Wonga what their APR is. They just won't get the money back.

[mikey4444]

Jo....the Regulator has at least forced companies like Wonga to assess the poor shmucks that they prey on properly now. But its still a deeply dishonest
line of business.

Glad those stupid adverts have gone !

[Cloverjo]

I agree, Mikey.

[hc4361]

I've just visited their website. If I borrow £111 for 23 days I will have to pay back £131.42

What's wrong with that? APR is meaningless for short term loans and the borrowers are very high risk so no bank will give them an overdraft. No assets worth seizing.

If it weren't for payday lenders just where would these people get a loan when they are in a hole? Back street money lenders who enforce the debts with baseball bats or escort them to the cashpoint on benefit days and charge a much higher interest rate.

[ummmm]

I agree, hc, they are okay for responsible borrowers who maybe had a blip that month.

[hc4361]

I have a £100 overdraft facility on my Santander current account. Thankfully I have never had to use it as they would charge me £1 for every day I was overdrawn even if it is by £5.

[Cloverjo]

Hc, referring to your post at 0951, that's £20. £20 is quite a lot of money when you have no money. It's not ok to charge that much.

[Peter Pedant]

hc the answer to the awful service Santander give is to get another bank and not go to wonga

and yes a wonga loan is better than a temp un negotiated overdraft for a few days - you havent added in the £25 for the letter telling you are overdrawn

but some how I think most wonga users are NOT in the position you describe

Oh the leggie svelte head of Santander is planning to charge you for keeping your money ( the days of interest paying accounts is over she said as she sashayed out of one shareholders' meeting )

[Peter Pedant]

yup Clove
Winston churchill commented - even 2/6 is a lot of money if you dont have it

[hc4361]

Surely if it were cheaper then not only would there be no incentive for regulated companies to loan such small amounts and the interest would be no deterrent to the feckless who borrow money to gamble or buy drugs.

The rate has to be enough to make potential borrowers stop and think before borrowing.

[hc4361]

PP, I'm sticking with Santander because nobody else will match the 3% interest on my £20k, plus all the benefits.

[sunny-dave]

Tricky - I dislike Wonga (in particular their advertising is pretty dubious) - but they are better than the unregulated loan sharks.

I do agree with hc4361 - there have been times in my life when £100 immediately was well worth the £120 I'd have to pay back when my paypacket arrived at the end of the month - and (as is always the case), cheap loans are only ever available when you don't actually need them ...

[Peter Pedant]

yeah but you are paying £10 a month arent you ?

[hc4361]

PP, £5 a month and that is more than covered by the cashback I pay on my direct debits. I pocket around £60 from them.