Wonga.com
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| Private | |
| Industry | Technology finance |
| Founded | 2006 |
| Founder | Errol Damelin |
| Headquarters | London, United Kingdom |
| Products | Short-term credit |
| Website | wonga |
Wonga.com (a trading name of WDFC UK Limited) is a British payday loan company offering "short-term, high-cost credit". The interest charged by the lender, which can equate to an annual percentage rate (APR) of 1509%, has been widely criticised. Wonga have said that they believe that APR is a poor measure of the true cost of short-term loans. As of April 2016, a loan of £100 over seventeen days (Wonga's average loan term) required £113.60 to repay. Wonga is a slang term of Romany origin for money, used in some parts of Britain since the 1980s.
The firm operates in the UK, South Africa, Spain, Germany and Poland. The company exited the Canadian market on May 6, 2016. The company invented fully automated risk processing technology to provide short-term, unsecured personal loans online, including via tablet and mobile app. The service was launched in October 2007. The firm was the first to provide an instant lending application on the iPhone.
Consumer credit suppliers were regulated in the UK by the Office of Fair Trading (OFT) until April 2014, and then by the new Financial Conduct Authority (FCA). The firm's lending practices have been controversial, and they have been criticised in Parliament and by the regulators, media and religious sources. In 2014 the firm was ordered by the FCA to pay compensation of £2.6m to borrowers for bad debt collection practices, including in 2010 sending and charging for letters purporting to be from law firms (which did not in fact exist) threatening legal action. The newspaper The Guardian quoted the head of the Law Society as saying that Wonga's activity, which he qualified as dishonest, could amount to blackmail, deception, and other breaches of the law. A formal police investigation for fraud was being considered as of 27 June 2014[update].
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