It appears to be getting worse if you have ever taken a loan out with wonga as they have recently announced that they are considering using debt collection services to collect from their defaulters.? The lender has arranged more than one million loans over the past 60 months.
Wonga was founded by Errol Damelin and Jonty Hurwitz. Many people have raised concerns over the number of people taking out these high interest payday loans, particularly over the Christmas period.
Wonga targets consumers that usually cant get a loan from main stream lenders.? They arrange small loans over a short period which can be approved within 15 minutes.? The average size of a wonga loan is ?257.
The most recently announced figures showed that Wonga?s profits had tripled to ?46?million in 2011.A spokesman for wonga said it was considering trying get the money owed by selling bad debts to third parties.
Liberal Democrat MP Ian Swales said that there is a chance that people 
may feel ?severely harassed?.
However, this controversial business, which has boomed in recent years, has come under fire for the high interest rates charged, particularly to customers who fail to pay their loans back within the original term. Wonga, for example, will charge an interest rate equivalent to an APR of 4,200% if customers borrow money over a year.
Wonga have announced that an average 15 per cent of its short term loans are not paid on time.? Statistics show that Wonga wrote off ?77 million as bad debt in 2011.
Henry Raine, Wonga director of legal affairs, told MPs. ?Bluntly, given the size of or our balance sheet, we have to look at alternatives, when customers fail to pay?.
Nicholas Parsons has come in for some criticism as he has been doing voice-overs for Wonga for over a year now.? Parsons seems to have has sold his respected voice to the controversial lender in what must be a lucrative deal.
And just when you thought it couldn?t get any worse, we are faced with former Atomic Kitten ?singer? Kerry Katona trying to flog these short term loans.? Katona was declared bankrupt in 2008 but since the start of January she has been encouraging Uk residents to take out loans with a company called Cashlady.? For those who are interested Cashlady is not actually a payday lender, but a company which matches borrowers to payday lenders.
Parsons has mostly escaped widespread critism for selling his soul to Wonga, while Katona is thought to be a little too dim to do the sums.
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Source: http://www.freedebtadvice-uk.com/2013/01/kerry-katona-nicholas-parsons-and-payday-loans/
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