Wonga – Money Saving Expert’s Opinion

admin — Fri, 31 Dec 2010 09:26:11 +0000

What Money Saving Expert have to say abiout Wonga…

From wonga.com, out to the big wide ranging world of the web. Firstly I started with Martin Lewis’s Money Saving Expert site (www.moneysavingexpert.com), which asks and then debates at length the question is Wonga a scam? Was this the article I was seeking to provide and independently detail how the Wonga scam was working in reality?

Sadly the answer was no! When I had fully read all the many posts and replies, the simple fact was that a customer had taken a pay day loan from Wonga and had failed to repay it on the agreed date and was endeavouring to imply that the company Wonga was a scam and a fraud. The majority of posts could be classed as testimonials, as they appear to be from Wonga customers giving independent reviews and solutions to how to resolve the unpaid debt from the originator, with a very supportive and protective tone towards Wonga.

Here are some examples of forum comments, posts and discussions that I found. Firstly posts and comments from www.MoneySavingExpert.com

Snakeeyes21

16-01-2010, 7:49 PM

Serious MoneySaving Fan

Join Date: Jun 2007

Posts: 1,962

Thanked 1,945 Times in 939 Posts

Quote:

Originally Posted by cooltt

Congratulations now you know why you should steer clear of these scam merchants no matter how desperate you are.

Pay what you owe as soon a possible unless you want this bill to go through the roof.

Payday loans etc… are nothing more than legalised loan sharks.

Thats a bit harsh.
Ive used them many times to get me out of some sticky situations, without a single problem.

To say their a scam is just pigheaded and ignorant, do you not live in the real world where some people have no other option to use these companies?

oh what it must be like to have a bank balance so big that you never have to worry about money.

Believe it or not wonga are one of the best of a bad bunch, I know I’ve tried them all

The op would have been given a chance to extend their loan by paying 20 or 40% of what they owed, then paying the balance plus interest ikn another 30 days, is it wonga’s fault they didn’t do this?

At what point are they a scam? are people not made aware of charges?
are people not made aware of what will happen if they don’t pay them back?

Or are you saying they become a scam once somebody doesn’t stick to the terms and conditions that they freely agreed to, and start getting additional charges.

freeoffers

17-01-2010, 2:10 AM

MoneySaving Stalwart

Join Date: Mar 2009

Posts: 204

Thanked 427 Times in 73 Posts

Its scary how these ‘small’ loans add up to large amounts, but i used to work for a payday company as a manager and they are not scams. all the terms are in writing and we used to get customers coming in month after month to put off their loans and they ended up paying 3 or 4 times the original loan.

Its not a scam, its just an exorbitant rate of interest.

bigdave1973

19-01-2010, 2:00 PM

MoneySaving Convert

Join Date: Dec 2009

Posts: 32

Thanked 5 Times in 5 Posts

It seems crazy that you cancelled your card. Your concern here is that you want to pay back your loan & get your debt cleared, so you cancelled the only way that Wonga have of clearing your debt?!?!

Cooltt, whilst this may not be the right product for you it doesn’t really mean that Wonga are a scam. They’ve done what they said they would and are probably charging the (high) fees they said they would. It’s not a scam, just an expensive loan

dazza12

25-05-2010, 10:54 AM

MoneySaving Newbie

Join Date: Mar 2006

Posts: 11

Thanked 5 Times in 2 Posts

Their landline telephone number is 0871 288 5704. Yes it does cost 10p a minute, this is hardly a scam when 1000s of companies get away with using 0871 numbers. My bank and ISP insist on using 0871 and 0844 numbers and often have me holding for a long time.

I’ve used the company in the past, and probably will again. I’m not up to my eyeballs in debt (in fact owe about a tenth of what I did 5 years ago), but occasionally I’ve needed to use them when a car repair has occurred the wrong side of payday. I’ve been fully aware of their terms, and also know how misleading APR can be when applied to short term loans. For instance, they don’t want to lend to you for a year, so why would a yearly calculation be appropriate? A separate calculation is needed for these types of loans (and also for overdrafts, bank charges etc) so a proper comparison can be made.

My own situation is that I needed £250 for 14 days. Paid it off on payday and that was that. A few months later came home to find water all over the floor. I couldn’t afford to buy a washing machine so checked out Wonga again – this time borrowed £400 initially for 14 days again but paid this off within 5 days – if I remember correctly paid only £25 in charges. That’s less that what my bank would have charged me if I’d gone over my limit.

It’s not intended to be used by those people robbing Peter to pay Paul, or who are at the point of desperation. As they credit check, it’s likely such people will be filtered out at application stage.

They do allow you to settle at any point during the loan. Most of their competitors insist on the loan being fixed so at least you can reduce any interest charges if you’ve got funds before the collection date.

It could be argued that I could use my credit card to do exactly the same thing. Although I’ve got a credit card, I use this for petrol and other work expenses, and get this repaid by my employer at the end of the month. My limit on this is low, this was requested by me – the last time I had a huge limit on my credit card was when I got into trouble (every purchase was justified as an ‘emergency’). I’m not going there again so requested a low limit.

I know that this sounds like I’m a Wonga employee, but I’m not. I agree that some people should avoid such companies like the plague, their problems will not be solved by this company but will compound them. However, for people like me it’s worked.

So an interesting overview from Martin Lewi’s team on the Wonga Scam debate… Next we look at Yahoo Answers

Wonga Scam – Starting Point…

admin — Fri, 17 Dec 2010 11:15:00 +0000

So where did I start to look for answers to the Wonga scam question? Firstly on wonga.com which might sound odd, naïve and generous to the company I am investigating! But nonetheless, this is where I began. My hypothetical question to myself was: how open, honest, transparent and genuine are they on their own website and what are they trying to hide or gloss over?

The simple and short answer for openness and transparency is initially it seems very (but I’m not going to be convinced quite yet)!

I started with the Wonga Forum. Lots of Topics from announcements to products, to reviews and questions; including an open General Discussion forum. Total activity was in excess of 1,990 posts across 640 topics. Plus this does not include Facebook comments or Twitter tweets. Trawling through the forums did not uncover any reviews or comments to support or answer the Wonga scam question. It did show the occasional disgruntled customer who had not been offered or declined a loan; or who had misunderstood the repayment terms, but nobody feeling that had been ‘scammed’ or ‘ripped off’. Overall the Forum was realistic and appeared genuine, with customers fully understanding and accepting what Wonga offered.

Staying on the wonga.com site I then read the independent articles and reviews in the About Us section. All good, but I would not expect anything else. Articles from national newspapers include the Financial Times, The Sunday Times, The Guardian, The Sun and the Daily Telegraph. All reported the openness and honesty of Wonga and how it works. Concluding and extolling the “responsible lending” ethos that Wonga states its business is founded on.

But, then I clicked on the “awards logos” at the foot of the articles page. Opening new independent websites, these renowned and genuine sites review and detail the Wonga Company and the awards they have won recently. An endorsement to Wonga, answering the Wonga scam question in the negative.

Firstly I clicked on the Credit Today logo. This took me to the Credit Today website, with an article and pictures of Wonga winning the award for “Alternative Lender of the Year”, presented by the comedian Bill Bailey. Next was the Webby Awards logo, which then opened a new webpage promoting Wonga as the “Peoples Voice Winner” at the 14^th annual Webby Awards. Finally I clicked the National Customer Service Awards logo. All endorsements of the company’s integrity.

The award list is very extensive, broken into year (2008, 2009 and 2010), there are over 28 awards, endorsements and nominations the company, and website technology and chief executive have been awarded. All are viewable and able to be researched or verified independently.

Next I looked at the wonderful world of social media. Starting with Twitter. Wonga has 2,432 followers and has tweeted over 640 times. Again all open, honest and genuine. No one claiming, inferring, accusing or stating that Wonga is a scam. Then to Facebook, where over 765 people like Wonga.

Summary

So my first phase of research had provided me with lots of in-depth and independently verified information and a far better understanding of who Wonga are and how they operate. But had still not fully answered or totally reassured me one way or the other to my original question is Wonga a scam