MSE News: Wonga busted by the FCA: 330,000 to have their loan wiped

A question about : MSE News: Wonga busted by the FCA: 330,000 to have their loan wiped

All Wonga customers who are 30 days or more in arrears on their loans will have the balance completely written off ...

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Wonga busted by the FCA: 330,000 to have their loan wiped

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• By all means sanction the lender but this decision is very poor. What happened to people taking responsibility for their own decisions?
• Probably the beginning of the end for the payday loans businesses - they will have to look very carefully at the business model going forward. If they can't charge the huge interest payments to offset the high risk of the loans , they won't continue for long.
• So where are those who "need" the money going to get it from now - unregulated loan sharks?
• The numbers are staggering though, 330,000 getting their debts written off and a further 45,000 having interest and charges stopped.
  Surely this is a sizeable chunk of Wonga's customer base and as such seeing this number struggling, have set alarm bells ringing within their own company without it having to be looked into by the FCA?
  Sure, there are people who simply don't care but there are also numerous others who have either hit on hard times and thought they could manage to repay and those who through circumstances not of their making get stuck in the circle of loaning, paying and reloaning...
  It's easy to sit back and judge people by their mistakes but you cannot honestly say that Wonga has been a beacon of virtue? They're in it to make money and will be 100% aware of the kinds of people they're attracting.
  That said, I don't entirely agree with debts being written off. If sufficient interest and charges have been made to repay the original loan and the same amount again in interest then fine as this brings it in line with recent changes being introduced but if someone has borrowed and simply failed to repay anything at all then (IMO) the debt should stand and interest and charges should be accrued upto the value of the loan amount.
  Honestly, I still believe that there is a place for Payday lenders so long as they are regulated and used correctly.
  MB
• Hopefully this will result in payday lenders being far more choosy about who they lend to. It'd lead to a whole lot less pain if credit simply weren't available to most of their customer base.
• As I understand it the Payday Loan industry is being forced to introduce loan 'affordability' checks. All current loans that would have failed such checks if they'd been in force at the time are being written off.
  All well and good and a step in the right direction, but what about all the other lending institutions which gave out loans left right and centre in years gone by? Credit card companies who increased credit limits as soon as the old limit was reached? Mortgage lenders who agreed 'interest only' mortgages with no capital repayment plan agreed?
  I've no doubt other's could add to this, but the question remains: are they going to be forced into line in a similar fashion?
• When does the period of 0-29 days of arrears start? At the promise date or the point two days later where they levy a Ј20 fine?
• Ok so i have an outstanding loan with wonga for Ј683, ive already made 2 repayments on the arrangement for Ј58 so in total i was Ј790 in debt at my peak before i made the repayment arrangement, im now classed as 57 days in arrears so from what ive read i fit the criteria for my debt to be wiped? i was unemployed when i took out the original loan and while i do fully admit me and me alone made the decision to take this loan, i knew i wouldn't be able to afford to re-pay it in one lump sum so before i even took it i knew id have to take a re-payment arrangement, ive used wonga for about 2 years and spent more time owing them money than i have been in the black, so my questions are will previous loans be looked into? Do i fit the criteria for the wipe? i have actually been refused a loan from wonga in the past even with the sub standard checks they have so im assuming this will go in my favor? the 10th is going to be very interesting :/
• Best news of the day!!
  Always thought Wonga were legalized loan sharks.
  In America pay-loans are more controlled than in UK.
  I hope some of those controls are adopted here.
• So will they be paying back all the interest and so called penalties to people who DID pay them off then?
• I got into financial difficulty about 8 months ago. I borrowed from Wonga and paid it back with my wages at the end of the month. 10 minutes after paying the loan back, I would have to take out another Wonga loan. This went on for 5 months - they even increased the amount that I could borrow to a level which was way beyond my income & expenditure. They obviously didn't use credit reference agencies as they would have seen that my level of borrowing was way too much. I ended up going on a Debt Management Plan with StepChange. I still owe Wonga Ј1062 and I'm 172 days in arrears as of 2nd October. I'm wondering whether I'm one of the 330,000 people who wasn't properly credit checked. If I'm not, then I'll be making a claim for the loan to be wiped.
  Also, on one occasion - rather than taking out Ј800 in one loan, I took out 8 individual Ј100 loans in one day!
• I wonder if as they are stating they shouldn't have leant to these 330,000 people, they will correct defaults placed on people's credit files as well.