Online Finance Industry Shows Growth
It is reported that there are over 1 million people without employment in the United Kingdom and many who are out of work or on low incomes, are struggling to manage their financial obligations. This can, understandably, cause a great deal of stress, especially when unexpected bills arrive through the door. Unfortunately for those facing financial hardship, there are not many places to turn, with lenders being stricter than ever with their lending criteria. This is the reason why payday lending has grown so significantly over the years; with a revenue which now amounts to over £242 million. Payday lenders offer short term, small loans to those who may have less than perfect credit ratings. The loans are due to be paid back on the next payday and although a credit check is carried out to determine suitability, it is not as restrictive as other financial institutions.
Wonga UK Success
The most successful and widely known payday lending firm in the UK is Wonga, who take a share of around 40% of the overall payday lending market. Wonga are probably most well known for their formerly engaging television advertisements (remember the puppets anyone?), as well as their former sponsorship of Premiership team Newcastle United. Established in 2007, Wonga have enjoyed significant growth in the UK over the years and have quickly became a household name. Although controversy always surrounds payday lending companies, there is no denying that Wonga have built and sustained a business which is trusted by millions of customers. Whether or not people agree with this type of lending, it is clear that there is a need for it and it is helping millions of customers to cover their bills each month. As long as the loan is paid back on time (i.e. next payday), there shouldn’t be any additional financial issues caused by this type of lending.
Although undeniably successful in the UK, Wonga are also spreading their wings to other parts of the globe and have already acquired several other similar businesses. Credito Pocket are a Spanish payday lending firm which were purchased by Wonga Spain. They also bought up the German firm, BillPay. BillPay offer a more unique service, allowing customers to pay their purchases with installments, so it is a slightly different service to the loan side of the business. Wonga also currently offer their services in Poland, South Africa and Canada.
It is expected that this won’t be where it ends for Wonga; they are likely to grow throughout other parts of the globe too and keep building on their already successful business. There are also plans for Wonga to develop into other services, such as the implementation of a loan facility for small businesses, who may be finding it difficult to obtain funding elsewhere. Wonga are definitely setting their sights high and due to constantly listening to customers and adapting their services to suit, they are quickly becoming the most successful and growing payday lending company.