Published on: 4 Sep 2018
The payday lender Wonga has seen complaints against its business rise by over 3000% in the last four years. Wonga has recently collapsed into administration and is struggling to finance thousands of compensation claims for mis-sold loans.
The company has been struggling since 2014 when the FCA ordered it to pay £2.6 million in compensation to 45,000 customers. The reason being that the FCA determined Wonga sold loans to people who could not afford their huge interest rates.
Some loans are reported to have annual interest rates as high as 5,853%
The online complaints tool Resolver, which handles claims for free, saw a huge increase in claims against Wonga since 2014. Around a third of the claims focused on loan affordability, and customers citing this received a £1,265 payout on average.
As Wonga is going through the administration process, new claims may take some time to resolve. If you have used Wonga, or another payday lender in the past, it is recommended you make a complaint as soon as possible.
You may need to collect evidence about your income and the loan in order to prove it was unaffordable. However, once you have this evidence, you should have a strong case to get a refund, as it will be clear the loan was mis-sold.
It’s not just Wonga that used these tactics when selling loans either. If you’ve got a loan from any other payday lender, you may be entitled to compensation.
If you want to escalate the matter either through a rejection of your claim, or failure by the lender to acknowledge your claim, consider contacting the financial ombudsman. The financial ombudsman is also free to use, although they may contact you for further information about the claim.
Resolver free online claim tool
Citizens advice for claiming compensation
Money advice online guide to payday loan refunds
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