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Wonga receives full FCA licence

Hannah Uttley
Written By:
Hannah Uttley

Payday loan lender Wonga has secured approval from the Financial Conduct Authority (FCA) to carry out regulated consumer credit activity.

The full permissions mean that Wonga has the ability to carry out credit broking, debt administration and debt collection, consumer credit lending, peer-to-peer lending and provide credit information and reference services.

The FCA took over the responsibility of regulating consumer credit firms from the Office of Fair Trading in April 2014, making the authorisation process a requirement of all firms in the sector.

Since the FCA took over, some firms have been required to conduct business activity using a temporary license while the regulator processes its applications by the target date of 1 April this year.
The FCA declined to comment on the matter but Andy Haste, chairman of Wonga, confirmed the firm’s authorisation.

“FCA authorisation is an important milestone for Wonga as we continue to build a responsible business with a long-term future, putting customers and good governance at the heart of everything we do,” he said.

“We have made progress against our commitment to deliver change and the FCA’s examination of the business has been rigorous and thorough. We support the work of the FCA and we will continue to work with them openly and constructively as a responsible participant in the financial services sector.”

Data published by YouGov earlier this month showed that Wonga became the second most improved brand of 2015.

The payday lender’s lending levels and profits have nosedived since it was forced to pay £2.6m in compensation for ‘unfair and misleading’ debt collection practices in June 2014. The failings took place between October 2008 and November 2010 and saw Wonga employ tactics to put customers under significant pressure to make loan repayments that many could not afford.

Wonga escaped a criminal investigation into the matter in February last year, with the City of London police concluding that there was not enough evidence to progress with an investigation.