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Wonga wobbles: what customers need to know

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Written by: Paloma Kubiak
28/08/2018
Wonga is on the ‘brink of collapse’, according to reports. If you’re an existing customer, here’s what you need to know.

The payday lender has allegedly contacted administrators in the event it were to go bust, and reports suggest it’s just about ‘hanging on’.

Wonga has been struggling since the regulator introduced a price cap on payday loans. In 2014, Wonga was forced to write off interest and charges for 45,000 customers costing it £2.6m. And 330,000 customers had their balance entirely written off.

In 2016, it reported a decline in revenues from £217.2m in 2015 to £77.3m in the year to December 2015 and posted a pre-tax loss of £80.2m as it underwent a “transformation to treat customers fairly by using affordability assessments”.

Business as usual

However, today Wonga confirmed it was “business as usual” for new applicants and for existing customers. So despite rumours about it going bust, you need to continue paying off your loan and your credit agreement still stands.

A spokesperson for Wonga, said: “Wonga recently raised £10m from existing shareholders to address the significant increase in legacy loan complaints seen across the UK short-term credit industry.

“Since then, the number of complaints related to UK loans taken out before the current management team joined in 2014 has accelerated further, driven by claims management company activity.

“Against this claims backdrop, the Wonga Board continues to assess all options regarding the future of the group and all of its entities.”

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