Meet the Wonga Aspirants: Britain applauded when payday lender went bankrupt … But beware of rivals
Wonga is gone, but there are still dozens of other payday loan companies.
And the complaints explode. The financial mediator received nearly 11,000 in the first three months of this year, an increase of 251% compared to the same period last year.
In some companies, as many as seven in ten have been withheld in favor of the customer.
No more Wonga OAP puppets. Britain’s largest payday lender collapsed into administration
Yet cheerful advertising campaigns – like the cheerful OAP puppets used by Wonga – continue to attract vulnerable borrowers in need of short-term loans.
And despite a government crackdown, which saw interest charges capped at double the original loan, the fees can be staggering.
So who are the Wonga aspirants?
The face of Sunny Loans is a fictional surfer named Sonny.
He’s a “super cool guy” who never gets stressed because “he knows that with the right support in his life, there is nothing to worry about”.
Based in Bury St Edmunds, Suffolk, Sunny Loans – the trading name of Elevate Credit International Limited – provides borrowers with access to cash in just 15 minutes.
Borrowers can apply for a loan between £ 100 and £ 2,500.
The standard representative APR is 1,293 percent, with sub-prime borrowers charged up to 1,617 percent.
At the standard rate, a loan of £ 1,000 over three months would cost a total of £ 1,514 including interest.
Last month, the advertising watchdog banned a series of television commercials for misleading interest rates and exaggerated claims.
Sunny Loans, which launched in 2013, claims they don’t charge late fees and go out of their way to help customers when they run into difficulties.
In the last six months of 2017, the Financial Ombudsman received 417 complaints regarding Elevate Credit International, of which 56% were confirmed.
Scott Greever, Managing Director of Elevate Credit, said: “On average our clients receive a loan of £ 215 over 68 days and pay an average of £ 85 in interest.
“This shows that the ‘annual’ percentage rate (APR) is not an accurate measure of the cost of a loan. We only approve 15 percent of new applicants. ‘
Owned by parent company Cash-EuroNet UK, QuickQuid has been active since 2007 and offers loans of up to £ 1,000 for new customers and £ 1,500 for returning ones.
Customers can then be offered a top-up if they meet their refunds. Its standard representative APR is 1,294 percent.
At that rate, that means if you borrowed £ 1,000 over three months, you’ll have to pay back £ 1,720 including interest – almost double the original loan.
If you borrowed £ 1,000 over three months with QuickQuid, you’ll need to pay back £ 1,720 including interest – almost double the original loan.
QuickQuid requests refunds of £ 240 in the first two months and £ 1,240 in the third month. Interest is applied daily, and because your balance stays higher for longer, you’ll pay off more on this loan than with Sunny Loans, which offers a different repayment plan.
Borrowers who run into trouble will be penalized with a late penalty of £ 15 – the maximum businesses can charge.
In the last six months of 2017, the Financial Ombudsman received 1,509 complaints about CashEuroNet UK, which also trades as Pounds to Pocket, another short-term lender. He ruled in favor of the client 72% of the time.
A spokesperson for CashEuroNet UK said: “We are committed to good lending practices and treating customers fairly, while ensuring consumers have access to reliable and affordable credit.
Peachy offers loans between £ 100 and £ 1,000 for between one and 12 months
With her bright yellow branding and articles on her Millennials website, Peachy seems to be targeting college students and young people in their twenties.
It offers loans between £ 100 and £ 1,000 for terms of one to 12 months.
Based on his representative 947% APR, if you borrow £ 1,000 over three months, you’ll pay back £ 1,514 in total as part of his repayment plan.
Borrow the same amount over six months and you’ll pay back £ 1,870. The rate you pay might be higher if you have a history of missed payments on loans or other bills.
It charges a late fee of £ 15 if you don’t pay off your loan in full the day after your repayment date.
Borrowers can extend their loan twice by texting the word “extend” to the lender.
Peachy, a business name of Cash On Go, is based in Manchester and was founded in 2010.
Customers lodged 67 complaints with the financial ombudsperson between July and December last year, of which 44% were confirmed.
Mr. Lender’s face is a cartoon of a happy guy in a suit carrying a big feather.
It offers loans of between £ 200 and £ 1,000 over six months.
His typical APR is 1,256 percent and the maximum is 1,462 percent. Borrow £ 1,000 over six months at the standard rate and you would pay back a total of £ 1,815.
The financial ombudsman received nearly 11,000 complaints about payday lenders in the first three months of this year, an increase of 251% from the same period last year.
The company says it doesn’t charge any late fees. But if you miss a payment, it will still damage your credit report.
If you’ve never borrowed from the lender before, they limit you to £ 500 the first time around.
Mr Lender, a trading name of PDL Finance, is based in Loughton, Essex, and was founded in 2008.
The Ombudsman received 38 complaints against Mr Lender between July and December last year, of which 53% were confirmed.
Based in Westcliff-on-Sea, Essex, Myjar was launched ten years ago and offers loans between £ 100 and £ 7,200 over three, six, 12 or 24 months, with a maximum interest rate of 1,326% .
Myjar says he will pay the money directly to your bank account within 15 minutes.
It claims to be able to offer loans “to anyone with a regular income, regardless of their credit rating.” Although he says that this “does not guarantee that we will approve you for a loan” and he has to be sure that the borrowers are able to repay the amount on time and bear the cost.
If you borrow £ 900 over three months, you’ll have to pay £ 431 in interest – so you’ll pay back a total of £ 1,332.
You will be charged an additional £ 15 if you are three days late with a payment.
In 2016, the Autorité de la concurrence et des marchés investigated two companies, Starcom Media-vest and TAN Media, which it said were organizing mentions for the lender in articles and blogs online without specifying that it they were advertisements.
The ombudsman received 201 complaints about Myjar between July and December of last year, and confirmed 53 percent in favor of clients.
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