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Wonga Loans @ www.wonga.com
Wonga is the UK’s market leading payday lender and they have a strong supporting presence on the global stage. This brand is also active in Canada, Poland, South Africa and Spain. Between 2007 and 2013 this company has enjoyed tremendous success, but disaster has struck in recent years. If we go back to 2013, they were issuing more than 10,000 loans every single day and generated profit after tax at £30.6m. Then came 2014 when they took on a heavy loss of £43.6m whilst the hit in 2015 was a whopping £76.5m. There are several reasons for the losses such as compensation payouts (fake law firms) and loan write-offs (based on updated affordability checks).
The FCA’s loan capping has been damaging, alongside the various stricter regulations that have been enforced in recent years. Negative press has been relentless from debt charities, politicians and trade unions. Their sponsorship deals also haven’t quite worked out. At one time they represented 3 clubs at the same point including Blackpool, Hearts and Newcastle. The only remaining contract is held with Newcastle that was always their biggest deal, but this isn’t helped through Newcastle’s drop from the Premier League to the Championship. It is very much a case of rebuilding the brand and gaining the trust moving forward. You’ll see that their TV advertising has become more toned down (no more puppets).
There has been no negative press recently (other than the media commenting on their falling profits). Various changes have been put forward. The Group has for instance sold off Everline and their short term product has now been supplemented by Flexi Loan. In offering 3 month loans, this’ll help them to make up profits squeezed from the shorter repayments where the max charge is 0.8% daily. There has been no recent data on their customer base. They did have 1 million customers that dropped to 575,000 during their controversies. That was a few years back now. They would have benefited greatly from the closures of many payday loan firms who went bust after the cap.
So just how did this lender become such a major force in the first place? When they launched in 2007 they didn’t take the industry by storm straight away. For many years, it was really PaydayUK and QuickQuid commanding most of the market share. What helped Wonga’s spike was their innovations in the short term sector. Unlike every other lender that offered funding for a full month, customers here could borrow cash for whichever day of the month they’d like. Any single amount from £1 onwards could also be selected. They were open for business 24/7 and their world class tech was even putting the banks to shame. Things have changed a little today at www.wonga.com.
The loan sums for instance now start from £50 onwards. They still however move in £1 increments. 24/7 support is no longer provided. They still operate 7 days a week, but the updated opening hours are 7am to 10pm. This isn’t a major issue in itself since their technology has been developed to automate lending decisions without any outside underwriting required. The Wonga loans are available between 1 and 35 days. You can select between £50 and £400 as a first timer or up to £1000 when returning. Wonga’s Flexi Loan has a 3 month repayment with the amounts differing a little at £150 to £400 with £1500 being the top sum on that side.
Pricing matches the cap for shorter periods and so for £100 you pay £5.60 over 7 days or £24 over 30. The deal at 3 months for £300 is more competitive at £155.97. Quick loans can be access via the Wonga login whenever they are required. This lender is an FLA member that is not the usual trade association opted for by lenders, since this organisation is focussed on the finance and motoring sectors. Moving forward, this firm commands the #1 spot in Google for “Payday Loans” and they have the largest Facebook following with around 370,000 fans. The TV ads are also helping to maintain their status as the premier name in short term lending.
£5.60 /£100 (7)
£24 /£100 (30)
£155.97 /£300 (3)
Data Taken from www.wonga.com: September 2016.