[News] Wonga - on verge of collapse.

[Goldstone1976]

Wonga and their ilk have a despicable business model that should, imo, be illegal.

That said, I’m always bemused by the glee that accompanies any legal company going bust. Wonga employ several hundred people - they’ll be out of work. Let’s all celebrate. Odd.

 

[sjamesb3466]

Wonga and their ilk have a despicable business model that should, imo, be illegal.

That said, I’m always bemused by the glee that accompanies any legal company going bust. Wonga employ several hundred people - they’ll be out of work. Let’s all celebrate. Odd.

Whilst I understand what you are saying, anyone willing to work for Wonga has questionable morals themselves so I won't be losing any sleep over it.

 

[sjamesb3466]

Also wondering if they are deliberately going bust so the owners can just reinvent them as another company in a years time, free of their historic compo claims.

 

[Goldstone1976]

Whilst I understand what you are saying, anyone willing to work for Wonga has questionable morals themselves so I won't be losing any sleep over it.

Or... it’s the only job they can get, given the location of most of their employees. I (and possibly you too) have the luxury of a decent amount of choice about who we’d work for. Others, in more deprived areas of the country, do not. For them, it’s often the choice between this job, and no job at all.

 

[GOM]

To put the counter argument, since so many on this thread seem really happy about a service company going bust and putting the staff/workers out of a job.

The use of APR for a loan of a week is totally misleading. APR is used a comparator for loans to compare over longer periods, i.e per year not a week.

Everything (well most things anyway) have a cost. A newspaper costs, a pint of beer costs and so too does money. In an example given above, I know not if they are genuine figures** the cost of borrowing £500 for a week was £25, a big APR, but the cost was simply £25 for the use of £500 for a week. Anybody hired any equipment from tool hire places etc ? Would anybody complain about being charged £25 for the use of a £500 piece of machinery for a week, or car hire a £15,000 car for £100 per day ? Probably not with such vehemence and outrage as I read when it concerns the hire of money.

We shouldn't focus on the headline APR for something it is not suitable for, instead of the real problems being when the loan is not repaid, which is not restricted to 'payday' loans, which anyone who doesn't keep up with their mortgage or any other loan will testify to.

** in fact I just looked on the Wonga site and this is on the front page

Representative example

Borrow £150 over 14 days
Interest rate 292% pa (fixed)
Total amount payable £166.80
Representative 1,509% APR

So THE COST, forgetting the APR being 1509%, the COST of using/renting/hiring/borrowing £150 for 2 weeks with Wonga is £16.80.

If you don't want to pay, or can't pay the cost then don't buy the product.

 

[Westdene Seagull]

It's slightly ironic that a parasidic company is being taken down by a parasidic industry, namely claims management companies.

 

[Pickles]

When these companies first appeared, quite a few were pleased because it took 'business' away from underground lenders and their methods.

If you miss a payment with wonga, or whoever, at least they won't smash your windows or break an arm, or make up interest penalties on the spot, enforced by violent threats.

 

[Murray 17]

To put the counter argument, since so many on this thread seem really happy about a service company going bust and putting the staff/workers out of a job.

The use of APR for a loan of a week is totally misleading. APR is used a comparator for loans to compare over longer periods, i.e per year not a week.

Everything (well most things anyway) have a cost. A newspaper costs, a pint of beer costs and so too does money. In an example given above, I know not if they are genuine figures** the cost of borrowing £500 for a week was £25, a big APR, but the cost was simply £25 for the use of £500 for a week. Anybody hired any equipment from tool hire places etc ? Would anybody complain about being charged £25 for the use of a £500 piece of machinery for a week, or car hire a £15,000 car for £100 per day ? Probably not with such vehemence and outrage as I read when it concerns the hire of money.

We shouldn't focus on the headline APR for something it is not suitable for, instead of the real problems being when the loan is not repaid, which is not restricted to 'payday' loans, which anyone who doesn't keep up with their mortgage or any other loan will testify to.

** in fact I just looked on the Wonga site and this is on the front page

Representative example

Borrow £150 over 14 days
Interest rate 292% pa (fixed)
Total amount payable £166.80
Representative 1,509% APR

So THE COST, forgetting the APR being 1509%, the COST of using/renting/hiring/borrowing £150 for 2 weeks with Wonga is £16.80.

If you don't want to pay, or can't pay the cost then don't buy the product.

You beat me to it. APR is misleading, as you say.

 

[sjamesb3466]

Or... it’s the only job they can get, given the location of most of their employees. I (and possibly you too) have the luxury of a decent amount of choice about who we’d work for. Others, in more deprived areas of the country, do not. For them, it’s often the choice between this job, and no job at all.

Again, understand what you are saying but it's very rare that you only have one choice of a job. It's often the case that it's the easiest lower paid job in an area. Nearly everywhere in the country needs carer's/cleaner's etc but that's hard work for the money on offer.

I moved to the Midlands as I couldn't afford to buy a house on the wages on offer down south for the work I was qualified to do. Easier said than done but another option if there's no work where you live.

 

[sjamesb3466]

To put the counter argument, since so many on this thread seem really happy about a service company going bust and putting the staff/workers out of a job.

The use of APR for a loan of a week is totally misleading. APR is used a comparator for loans to compare over longer periods, i.e per year not a week.

Everything (well most things anyway) have a cost. A newspaper costs, a pint of beer costs and so too does money. In an example given above, I know not if they are genuine figures** the cost of borrowing £500 for a week was £25, a big APR, but the cost was simply £25 for the use of £500 for a week. Anybody hired any equipment from tool hire places etc ? Would anybody complain about being charged £25 for the use of a £500 piece of machinery for a week, or car hire a £15,000 car for £100 per day ? Probably not with such vehemence and outrage as I read when it concerns the hire of money.

We shouldn't focus on the headline APR for something it is not suitable for, instead of the real problems being when the loan is not repaid, which is not restricted to 'payday' loans, which anyone who doesn't keep up with their mortgage or any other loan will testify to.

** in fact I just looked on the Wonga site and this is on the front page

Representative example

Borrow £150 over 14 days
Interest rate 292% pa (fixed)
Total amount payable £166.80
Representative 1,509% APR

So THE COST, forgetting the APR being 1509%, the COST of using/renting/hiring/borrowing £150 for 2 weeks with Wonga is £16.80.

If you don't want to pay, or can't pay the cost then don't buy the product.

Problem is that the people getting a loan often can't pay the cost and can't get credit elsewhere (often for good reason). These companies pray on the stupid and the desperate who may not think they have another option. It's the companies responsibility to lend responsibly and Wonga have failed to protect people that need protecting from themselves.

 

[Raleigh Chopper]

Just seen an ad on TV from Wonga offering 5 per cent off if you repay (or something like that) seems they want their money back quicksticks before they go under.

 

[Triggaaar]

I may lend them a grand at 1,450% APR !

If they want to take you up on that offer, may I suggest you pass, as you won't get a penny back.

 

[Bob'n'weave]

I don't want to see anyone put out of a job but I am not sad to see this lot go under. Yes, the example from their site shows a reasonable interest rate over 14 days for £150, but it's still aimed at people who are the most likely to get into trouble with any repayments which is when the compound interest starts to rack up. Bearing in mind it was not that long ago that we were watching Panorama/Watchdog expose's on high interest loan sharks, and now they are all over the TV like they are giving it away for nothing.

Don't even start me on Top Cat getting a mortgage!

 

[GOM]

Problem is that the people getting a loan often can't pay the cost and can't get credit elsewhere (often for good reason). These companies pray on the stupid and the desperate who may not think they have another option. It's the companies responsibility to lend responsibly and Wonga have failed to protect people that need protecting from themselves.

Like I said, if you can't afford it don't buy it. Wonga and others make NO money from somebody who does not repay, they lose money, it is not in their interest, pardon the pun, to lend to someone who cannot or is not willing to repay.
Some people seem to have this idea that everyone working for payday companies are shysters or conmen, they are not. They are financial houses simply providing short term loans.

 

[portslade seagull]

Good rip off merchants. Let's hope some more follow them

 

[Arkwright]

While you can rightly question the morals of companies like Wonga they were a Pay Day Loan Company designed to get you out of a sticky short term financial problem. The problem was the lack of credit checks and lending to customers who couldn't grasp the financial implications and ridiculously high cost.
Short term borrow say £100 and pay say £20 for the convenience sounds a great idea but only if you pay it back on time, if you don't you are screwed. Don't just blame Wonga but blame the customers who had little to no intention of paying the loan off in accordance to the agreed terms.

 

[Triggaaar]

Wonga and their ilk have a despicable business model that should, imo, be illegal.

Agreed.

That said, I’m always bemused by the glee that accompanies any legal company going bust. Wonga employ several hundred people - they’ll be out of work. Let’s all celebrate. Odd.

You can't have it both ways. Do you want these companies to be illegal or not?

 

[dazzer6666]

http://newsthump.com/2018/08/27/won...r-accidentally-borrowing-a-fiver-from-itself/

 

[GOM]

I don't want to see anyone put out of a job but I am not sad to see this lot go under. Yes, the example from their site shows a reasonable interest rate over 14 days for £150, but it's still aimed at people who are the most likely to get into trouble with any repayments which is when the compound interest starts to rack up. Bearing in mind it was not that long ago that we were watching Panorama/Watchdog expose's on high interest loan sharks, and now they are all over the TV like they are giving it away for nothing.

Don't even start me on Top Cat getting a mortgage!

The majority of people who use these companies do so and repay on time. If they didn't the companies wouldn't exist. Let the nanny state take over and ban this service because a few abuse it.
Back to the loan sharks.

 

[Triggaaar]

Anybody hired any equipment from tool hire places etc ? Would anybody complain about being charged £25 for the use of a £500 piece of machinery for a week, or car hire a £15,000 car for £100 per day ?

Although I understand your point about APR, plant and car hire are completely different. They have a limited life and need maintenance, cleaning, someone at the hire centre to manage the product in and out. And the hire centres need to be paid for. With money, it's a cheaper call centre and automatic systems, and when the money is returned to them it's the same as when it left.