Coalition and banks under fire as Wonga launches business loans Stella Creasy, Labour MP for Walthamstow, added that the Government's Project Merlin, which aimed to ease credit facilities by forcing banks to show the "capacity and willingness" to lend £190bn each year, had not delivered on its aims, leaving companies "desperate to stay afloat." Wonga, which specialises in short-term personal loans, will now hand cash-strapped firms between £3,000 and £10,000 for up to a year after a 15-minute application. The loans, which it hailed as a "new way [to] smooth out financial bumps," will start at 16.6pc APR and rise sharply to 180pc APR for customers with poorer credit ratings. Rival lenders accused the company of "bottom feeding," and "predatory" behaviour. "Wonga is targeting struggling micro-businesses," said Anil Stocker, founder of rival loan company MarketInvoice. Lee Manning, president of insolvency trade body R3, said firms would only want the kind of service Wonga is offering as a "last resort." Wonga uses a complex algorithm to decide whether to loan a person cash and turns about two thirds of applicants away. It also claims APR is not "relevant" to Wonga deals because its loans are offered on a short-term basis.