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Payday lender Wonga has announced its intention to go into administration after losing its battle to stay afloat.

The company said in a statement that it had assessed all options and had decided that administration was the appropriate route.

It had already stopped accepting new loan applications as it fought to stave off collapse.

Its demise in the UK follows a surge in compensation claims amid a government clampdown on payday lenders.

Grant Thornton will be acting as administrators.

In a statement Wonga said: "Customers can continue to use Wonga services to manage their existing loans but the UK business will not be accepting any new loan applications. Customers can find further information on the website.

I have a Wonga loan, will this be written off?

Unfortunately for you, the repayments will still have to be made.

Although this will be overseen by the administrators - in the short-term at least - there is no practical difference in the way that these payments are made.

A service will continue for anyone who needs help, and anyone struggling to repay can still get in touch, and can also contact debt charities such as Citizens Advice or StepChange for free advice.

Read more answers to your questions here

"Wonga's overseas businesses continue to trade and are not part of this announcement."

The City regulator, the Financial Conduct Authority (FCA), said: "The FCA will continue to supervise Wonga once it is in administration and is in close contact with the proposed administrators with regard to the fair treatment of customers.

"Customers should continue to make any outstanding payments in the normal way. All existing agreements remain in place and will not be affected by the proposed administration. However, the firm is no longer able to issue new loans."

Wonga, which was the UK's biggest payday lender, had faced criticism for its high-cost, short-term loans, seen as targeting the vulnerable.

Image caption James Ball was a Wonga customer

Among those who used its services at its height was journalist James Ball, now aged 32. He said Wonga made it easy to get a loan when he was young and prone to overspending.

But he said that it was also convenient for him to borrow when he was struggling with student debts and commuting costs among other bills.

"I am absolutely not looking for sympathy," he said.

In 2014, the Financial Conduct Authority found that Wonga's debt collection practices were unfair and ordered it to pay £2.6m to compensate 45,000 customers.

Since then, payday loan companies have faced tougher rules and have their charges capped.

This hit Wonga's profits hard. In 2016, it posted pre-tax losses of nearly £65m, despite claiming its business had been "transformed".

It continued to face legacy complaints and was forced to seek a bailout from its backers in August amid a surge in claims.

It was a huge fall from grace for Wonga, which in 2012 was touted to be exploring a US stock market flotation that would have valued it at more than $1bn (£770m).

Analysis: Kevin Peachey, personal finance reporter

Wonga never considered itself to be a payday lender, preferring instead to describe itself as a maverick technology company that happened to sell loans.

Its technology was groundbreaking, allowing the smartphone generation to choose how much they wanted to borrow with the slide of a thumb.

That convenience, matched with a huge advertising campaign featuring amusing puppets and upbeat voiceovers, proved a hit. At the height of its success in 2013, Wonga had a million customers.

But Mick McAteer, founder of the not-for-profit Financial Inclusion Centre, said this demand was a bubble: "They were flogging [credit] and they created demand for it."

In other words, some borrowers simply did not need to borrow from a payday lender, but were attracted towards these high-cost, short-term loans anyway.

The collapse spells the end of a rags to riches to rags story of a company that was vilified for its conduct when lending to people who could not afford to repay.

The market has changed as a result of the FCA's crackdown, and thousands of former customers have sought compensation.

Anyone awaiting compensation payments from Wonga is now likely to be in the queue for a payout from the sale of any assets.

Many have said they will not mourn the loss of Wonga.

Guy Anker, deputy editor of MoneySavingExpert.com, said: "Payday loans are hideously expensive and morally questionable products - and many have been mis-sold to vulnerable customers. They should only be seen as a loan of absolute last resort.

"So to have one fewer payday loan lender - and Wonga was a biggie - is positive for consumers, but of course is very sad for the staff who will have lost their jobs."</s>THE UK-BASED payday lender Wonga has gone into administration.

It comes amid a wave of compensation claims after the British government cracked down on high-interest lending a number of years ago.

Customers who still have loans with Wonga will have to continue making repayments while the company is in administration.

Let us know: Have you ever used a payday lender?</s>Payday lender Wonga has collapsed into administration, bringing down the curtain on one of Britain's most controversial loans companies.

Payday lender Wonga has collapsed into administration, bringing down the curtain on one of Britain's most controversial loans companies.

The firm's collapse has put 500 jobs at risk and comes hours after it stopped taking new loan applications.

Corporate undertakers at Grant Thornton have been appointed to carry out the administration.

In a statement, Wonga said that having assessed all options, the board "concluded that it is appropriate to place the businesses into administration."

It added: "Wonga customers can continue to use Wonga services to manage their existing loans but the UK business will not be accepting any new loan applications. Customers can find further information on the website."

On Wednesday, Wonga held emergency talks with the Financial Conduct Authority over the impact of collapse on its existing borrowers, thought to total around 220,000.

It is expected that Grant Thornton will now run Wonga's loan book.

Customers were being told by the company that despite the collapse, they are still required to repay any outstanding money.

Over the weekend, Wonga said it was "considering all options", just weeks after shareholders pumped £10 million in a bid to save it from going bust.

Earlier this month, Wonga said its struggles were due to a "significant" increase industry-wide in people making claims in relation to historic loans.

The lender blamed claims management companies for the rise, but said it was making progress against a transformation plan set out for the business.

On Sunday, Wonga said the number of complaints related to UK loans taken out before 2014 had "accelerated further".

"Against this claims backdrop, the Wonga board continues to assess all options regarding the future of the group and all of its entities," the company said at the time.

Wonga has faced a barrage of criticism over the high interest it charges on its loans and it has been accused of targeting those who are vulnerable.

In 2014, the firm introduced a new management team and wrote off £220 million-worth of debt belonging to 330,000 customers after admitting making loans to people who could not afford to repay them.

In the same year, the FCA said it would bring in stricter affordability checks to the industry and introduce a cap on the cost of payday loans on the amount borrowed per day.</s>Payday lender Wonga has announced that it is going into administration along with its parent company.

In a statement, the company said that having assessed all options, the board ‘concluded that it is appropriate to place the businesses into administration’.

It comes hours after Wonga said it would stop accepting new loan applications.

In a statement, it said: ‘Wonga customers can continue to use Wonga services to manage their existing loans but the UK business will not be accepting any new loan applications.

‘Customers can find further information on the website.’

Grant Thornton is in the process of being appointed administrator.

On Wednesday, Wonga held emergency talks with the Financial Conduct Authority over the impact of its collapse on existing customers.

Over the weekend, Wonga said it was ‘considering all options’, just weeks after shareholders pumped in £10 million in a bid to save it from going bust.

Earlier this month, the lender said its struggles were due to a ‘significant’ increase industry-wide in people making claims in relation to historic loans.

Wonga has faced a barrage of criticism over the high interest it charges on its loans and it has been accused of targeting those who are vulnerable.

In 2014, the firm introduced a new management team and wrote off £220 million of debt belonging to 330,000 customers after admitting making loans to people who could not afford to repay them.

In the same year, the FCA said it would bring in stricter affordability checks to the industry and introduce a cap on the cost of payday loans on the amount borrowed per day.</s>Payday lender Wonga has announced its intention to go into administration after losing its battle to stay afloat.

The company said in a statement that it had assessed all options and had decided that administration was the appropriate route.

It had already stopped accepting new loan applications as it fought to stave off collapse.

Its demise in the UK follows a surge in compensation claims amid a government clampdown on payday lenders.

Grant Thornton will be acting as administrators.

In a statement Wonga said: "Customers can continue to use Wonga services to manage their existing loans but the UK business will not be accepting any new loan applications. Customers can find further information on the website.

I have a Wonga loan, will this be written off?

Unfortunately for you, the repayments will still have to be made.

Although this will be managed by the administrators - in the short-term at least - there is no practical difference in the way that these payments are made.

A service will continue for anyone who needs help, and anyone struggling to repay can still get in touch, and could also contact debt charities such as Citizens Advice or StepChange for free advice.

Read more answers to your questions here

"Wonga's overseas businesses continue to trade and are not part of this announcement."

Wonga, which was the UK's biggest payday lender, had faced criticism for its high-cost, short-term loans, seen as targeting the vulnerable.

In 2014, the Financial Conduct Authority found that Wonga's debt collection practices were unfair and ordered it to pay £2.6m to compensate 45,000 customers.
• Wonga: Where have all the borrowers gone?

Since then, payday loan companies have faced tougher rules and have their charges capped.

This hit Wonga's profits hard. In 2016, it posted pre-tax losses of nearly £65m, despite claiming its business had been "transformed".

It continued to face legacy complaints and was forced to seek a bailout from its backers in August amid a surge in claims.

It was a huge fall from grace for Wonga, which in 2012 was touted to be exploring a US stock market flotation that would have valued it at more than $1bn (£770m).

Wonga never considered itself to be a payday lender, preferring instead to describe itself as a maverick technology company that happened to sell loans.

Its technology was groundbreaking, allowing the smartphone generation to choose how much they wanted to borrow with the slide of a thumb.

That convenience, matched with a huge advertising campaign featuring amusing puppets and upbeat voiceovers, proved a hit. At the height of its success in 2013, Wonga had a million customers.

But Mick McAteer, founder of the not-for-profit Financial Inclusion Centre, said this demand was a bubble: "They were flogging [credit] and they created demand for it."

In other words, some borrowers simply did not need to borrow from a payday lender, but were attracted towards these high-cost, short-term loans anyway.

The collapse spells the end of a rags to riches story of a company that was vilified for its conduct when lending to people who could not afford to repay.

The market has changed as a result of the FCA's crackdown, and thousands of former customers have sought compensation.

Anyone awaiting compensation payments from Wonga is now likely to be in the queue for a payout from the sale of any assets.

Many have said they will not mourn the loss of Wonga.

Guy Anker, deputy editor of MoneySavingExpert.com, said: "Payday loans are hideously expensive and morally questionable products - and many have been mis-sold to vulnerable customers. They should only be seen as a loan of absolute last resort.

"So to have one fewer payday loan lender - and Wonga was a biggie - is positive for consumers, but of course is very sad for the staff who will have lost their jobs."</s>Aug 30 (Reuters) - Britain’s biggest payday lender Wonga Group collapsed on Thursday, putting its operations in the country into administration.

Privately owned Wonga, which initially enjoyed rapid growth via its short-term, high interest lending often to troubled borrowers, fell into difficulty in recent years after scrutiny of its practices led to a cap on interest on payday loans.

“A decision has been taken to place Wonga Group Limited, WDFC UK Limited, Wonga Worldwide Limited and WDFC Services Limited into administration,” Wonga said in an email.

“The Boards of these entities have assessed all options regarding the future of the Group and have concluded that it is appropriate to place the businesses into administration,” it said.

Wonga said its overseas businesses were not part of the announcement. Administration is a form of creditor protection. (Reporting by Noor Zainab Hussain in Bengaluru; editing by Kate Holton)</s>London — Wonga, which became Britain’s biggest payday lender but faced accusations of targeting vulnerable customers, has collapsed into administration.

The company board "concluded that it is appropriate to place the businesses into administration", it said in a statement on its website late Thursday.

Corporate undertakers at Grant Thornton have been appointed to carry out the administration. Wonga, which employs 500 people, is thought to have about 220,000 borrowers.

"Wonga customers can continue to use Wonga services to manage their existing loans but the UK business will not be accepting any new loan applications," the lender said. "Wonga’s overseas businesses continue to trade and are not part of this announcement."

Wonga’s tumble comes after a rise in compensation claims following a government crackdown on the payday loans industry. Earlier this month, Wonga said its struggles were due to a "significant" increase industry-wide in people making claims in relation to historic loans.

Wonga has faced a barrage of criticism over the high interest it charges on its loans and has been accused of targeting the vulnerable.

"There will be few tears shed over Wonga’s woes which have seen its chickens come home to roost over business practices likened to legal loan-sharking," said Steve Turner, the assistant general secretary of Unite, Britain’s biggest trade union. "Wonga and the emergence of similar payday loan vultures are a symbol of everything that is wrong with our economy, which sees too many people trapped in insecure work and a spiral of debt because of shrinking incomes."

In 2014, the Financial Conduct Authority (FCA) regulator said it was bringing in stricter affordability checks to the industry and introducing a cap on the cost of payday loans on the amount borrowed per day. That year, Wonga introduced a new management team and wrote off £220m of debt belonging to 330,000 customers after admitting making loans to people who could not afford to repay them.

The FCA said Wonga customers should continue to make outstanding payments. "All existing agreements remain in place and will not be affected by the proposed administration," it said.

Business Day reported in June that Wonga’s South African founder, Errol Damelin, quit its board in 2014, amid intense scrutiny of the UK’s payday lending industry.</s>Britain’s biggest payday lender Wonga Group collapsed on Thursday, saying it had decided to put its UK operations into administration.

Privately owned Wonga, which initially enjoyed rapid growth via its short-term, high-interest lending often to troubled borrowers, fell into difficulty after regulatory scrutiny of so-called payday lenders led to a cap on interest rates.

“A decision has been taken to place Wonga Group Limited, WDFC UK Limited, Wonga Worldwide Limited and WDFC Services Limited into administration,” Wonga said in an email.

“The Boards of these entities have assessed all options regarding the future of the group and have concluded that it is appropriate to place the businesses into administration,” it said.

Wonga said its overseas businesses were not part of the announcement.

Wonga said in its statement that its UK business would not be accepting new loan applications, but its customers could continue to use its services to manage existing loans.

Wonga had just raised 10 million pounds ($13.01 million)from investors amid a surge in compensation claims related to loans taken out before 2014.

Britain’s payday lending industry has been heavily criticised by campaigners who say its high interest rates and marketing tactics have been unfair for vulnerable borrowers.

Wonga shot to prominence in the years after the financial crisis, filling the gap left by big banks as they retreated from short-term lending. At its peak in 2012, it was making a pretax profit of over 1.5 million pounds per week.

Wonga is now in the process of appointing Grant Thornton as administrators. The company’s most recent accounts show it made a loss of 66.5 million pounds in 2016.</s>The payday lender giant has waved the white flag hours after it announced it was no longer taking applications for new loans. And it comes weeks after its chief executive reportedly warned it was in danger of becoming insolvent amid a deluge in compensation claims. In a statement, Wonga said that having assessed all options, the board "concluded that it is appropriate to place the businesses into administration". It added: "Wonga customers can continue to use Wonga services to manage their existing loans but the UK business will not be accepting any new loan applications.

"Customers can find further information on the website." Wonga bosses had confirmed earlier they were no longer processing applications for the interest-high payday payouts. New regulations and ongoing controversy have long pushed the cash giant, which sponsors Newcastle United, to the brink. It has previously been heavily criticised for offering huge interest on loans – and has been accused of targeting vulnerable people.

The firm has been in decline for the past four years after regulators stepped in to tackle extortionate APRs of up 5,800%. Financial Conduct Authority officials found Wonga’s debt collection practices were unfair and ordered it to pay £2.6 million to 45,000 customers. The firm’s profits were then smashed – posting pre-tax losses of nearly £65 million in 2015. Wonga chiefs were then forced to seek a bailout from its backers this month after a surge of compensation claims.

The firm was once touted has having a valuation of more than £770 million – and even considered being floated on the US stock market. Revenues from Wonga's consumer lending collapsed from £217.2 million to £77.3 million in 2015. The business moved onto longer-term more flexible loans since after the FCA crackdown – but have continued to struggle. Customers numbers dropped to just 220,000 this time last year – falling from on million in 2013. Yet just weeks ago a consortium of high-profile technology investors initially saved Wonga by chipping together a £10million cash injection.</s>The FCA is holding meetings with prominent payday lender Wonga, as the troubled company could delay its fall into administration, according to reports.

The watchdog has stepped in to hold crisis talks with senior Wonga staff over the expected appointment of administrators, The Times reports.

Wonga raised £10m from shareholders a month ago but still appears to be in financial difficulty amid concerns over its ability to meet potential compensation claims.

A source told The Times that the FCA wanted more information on how an administration would impact customers on its short-term, high-interest loans.

The FCA has taken a stronger line on high-cost credit in recent years, including by capping fees. Wonga faced its own difficulties in 2014 when it received a fine for unfair debt collection practices.

FCA targets overdrafts and high-cost credit to help vulnerable consumers

Wonga was previously Britain’s largest online payday lender, but has been criticsed over annual interest rate charges of around 4,000 per cent.
Wonga, the largest payday lender in the United Kingdom, collapses into administration.