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Wonga will write off 330,000 loans after FCA investigation


The UK’s biggest pay day lender, Wonga, have today announced they will write off 300,000 customer loans, totalling in £220 million, after the financial conduct authority (FCA) discovered the company was not doing enough to assess customers ability to meet their repayments.
Approximately 330,000 customers who are in arrears of 30 days plus, as at 2 October 2014, will have their debt written off by Wonga. Also, approximately 45,000 customers who are in arrears of up to 29 days, as at 2 October 2014, will be asked to repay their debt without interest and charges, and will be given an option of paying off their debt over an extended period of four months.

Wonga have now appointed a new chairman, Andy Haste, and have strengthened their lending criteria by setting additional requirements around the financial circumstance of possible customers.
This comes after it was revealed Wonga’s profits have halved this year, after it was fined £19 million for sending out fake legal letters to customers struggling with arrears.
Andy Haste, Wongas new chairman, said:
“It’s clear to me that the need for change at Wonga is real and urgent. Our regulator is determined to improve standards in consumer credit and I share that determination. There is much to do in order to make Wonga a sustainable and accepted business, and today’s announcement is a significant step forward in that process.”

Clive Adamson, director of supervision at the FCA, said:
“Wonga’s misconduct was very serious because it had the effect of exacerbating an already difficult situation for customers in arrears. We are pleased that Wonga has been working with us to put matters right for its customers and to ensure that these historical practices are truly a thing of the past.
“The FCA expects firms to pay particular attention to fair treatment of those who have difficulty in meeting their loan repayments.”

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