We use a minimal number of cookies to enhance your browsing experience - you can change your settings at any time.
The UK's only Multi Agency Credit Report

Take a FREE 30-day no obligation trial today. Call us on 0800 612 0421 for assistance.

Forgotten Password?

Making loads of Wonga

Posted in 'Personal Finance' by Barry Stamp

20 September 2012

Payday loan provider Wonga, which started out in 2007, has reported revenues of £184.7m in its financial year ending 31 December 2011, an increase of 225%. Net income grew by 269% to £45.8m, generated from over 2.4 million loans advanced in that period.

Such success underlines the dearth of alternatives available to ordinary consumers when seeking short term financial support – it is generally quicker, and sometimes cheaper, to take a payday loan than to obtain an overdraft from an established bank account in current economic circumstances. On the other hand, the payday loan sector attracts much criticism, built upon fears that credit may be too easy to access and should not be allowed to grow out of control. Wonga rejects two in every three applications, which gives an indication of both the level of demand and of the quality of the applicant pool.

Errol Damelin, Wonga’s chief executive, has recently told of the company’s expansion plans to other financial products, saying, 'You will absolutely see Wonga in areas where the traditional financial services players don’t deliver good value. We’ll do other stuff like payments and savings. We’ll probably do mortgages at some point.' Wonga has already expanded into business loans via Wonga for Business, which provides loans to companies of up to £10,000 for terms of between one week and one year.

He says that the growth of payday loans is down to the array of distribution vehicles that are now available. “78% of our customers own a smartphone and over a third have an iPhone, plus we understand that unexpected needs for short-term cash don’t always happen while you’re sat by a laptop,” he says.

Barry Stamp is a co-founder of Checkmyfile and is a Chartered Banker and a Fellow of the Institute of Credit Management. He can be contacted at barry.stamp@checkmyfile.com.

Barry Stamp

Barry is a Chartered Banker and a Fellow of the Institute of Credit Management. He has a degree in Statistics and Business Economics from the Open University. Barry writes mostly on news from the worlds of banking and mortgages.

Barry is a co-founder of checkmyfile.

Related Articles

Big Six energy firms ordered to refund 3 million households

A ruling by energy firm’s regulator, OFGEM, has ordered the Big Six energy companies to refund an estimated 3 million households with an average payment of £50.

OFGEM found that the Big Six had withheld payments from customer who switched to a new energy supplier. The Big Six are British Gas, EDF, SSE, Scottish and Southern, E.on and Npower.

OFGEM has warned the Big Six that if they do not proactively make headway in refunding the £153m accumulated over the past 6 years to their customers, then they will face enforcement action.

The energy suppliers are launching campaigns to ask consumers and previous consumers to get in contact to see if they are due to be reimbursed. Dermot Nolan of Ofgem says, “Failure to deliv .....

16 Sep 2014 by

Amy Flower


Personal Finance

Full Article

Foreign investors advised to brace for possible collapse of the pound

With the Scottish referendum fast approaching, the world’s powerful investors are suddenly waking up to the possibility that a ‘YES’ vote for independence may have serious consequences on the UK Economy.

Japan’s biggest bank, Nomura, has advised its clients to break financial ties to the UK and to prepare themselves for a possible collapse of the pound. As polls are currently reporting the independence campaign running neck and neck, Nomura warns that the separation of Scotland from the rest of the UK after more than 300 years would be a ‘cataclysmic shock’.

“Last week saw the ‘fast money’ funds moving, however now we are seeing ‘real money’ clients acting,” says Nomura’s Jordan Rochester. “The risks are suddenly being seen .....

16 Sep 2014 by

Kirstie Brown


Personal Finance

Full Article

Can Primark crack the US market?

Primark looks to succeed in the US where other UK retailers have failed

15 Sep 2014 by

Tom Line


Personal Finance

Full Article

Accepted Payment Methods: VISA, MasterCard and Direct Debit

© Copyright Credit Reporting Agency Ltd 2000 to 2014. All Rights Reserved.

United KingdomAustraliaUnited States via TrueCredit

Customer Feedback