Wonga Administration: What it Means For You

Posted by Jamie Mackenzie Smith in Personal Finance on 31 August 2018

On Thursday 30th August the payday lender Wonga filed for Administration, following a spike in compensation claims and increased pressure on the payday loans industry. This follows a steady decline in this form of lending since the FCA began introducing stricter regulations 2013 in the name of protecting consumers.

This comes in spite of the recent findings that in the UK people are now more likely to be borrowers than savers, indicating that more money is being borrowed form more ‘traditional’ lenders.

Can I still take out a Wonga loan?

At time of writing, Wonga are not currently accepting any more applications for any of their loan products, which will presumably continue to be the case unless the business is bought. Other payday lenders are still available, but considering the size of Wonga as a business it may set a precedent for others to follow suit.

Do I still have to repay my existing loan?

If you’re a current Wonga customer and you’re paying off a loan, that loan will still very much exist regardless of what the outcome of the administration is. In this type of situation, it is common for the administrators to sell off the loan in an attempt to reclaim as much money as possible. Should this happen, your loan will be transferred to another company, and you can expect payments to continue as normal unless you’re informed otherwise.

What if I don’t pay?

As with any other loan, if you don’t pay the amount owed your Credit Rating will be affected and Defaults, CCJs and Collection Agencies could still be deployed in attempt to reclaim money owed. In spite of the current situation, all agreements made with Wonga will still stand but if you are in any doubt about the status of your loan, you should contact Wonga immediately.

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