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Wonga And The Church
38 Answers
Is the Church of England in danger of suddenly becoming effective and relevant?
or is it just talk?
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or is it just talk?
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I'm all for this move by the Church. Wonga and the rest of them are no more than shysters and loan shark, except that loan sharks don't normally spend millions of pounds on expensive and childish TV adverts. Churches should be used every day, not just on Sunday mornings. If they can provide a free resource for local Credit Unions, than more power to their elbow. The Church is sometimes accused of being irrelevant and out of touch, so any move to makes them more useful to our society is to be welcomed. The Church shouldn't just be about preaching to the converted.
"Is the Church of England in danger of suddenly becoming effective and relevant?" - Don't be ridiculous. The Church will get is ar5e kicked by wonga et al. These companies lend to those who cannot get credit normally, they have extortionate rates to cover the inevitable welching. The only way the church can compete is to undercut the rates and/or slacken the criteria. Either way they'll run out of money very quickly.
Yes, Tora that is exactly the point most people miss. And is the rate of all of them that extortionate for short term borrowing? Not done the calcs but I'm pretty sure that if you take bank charges for overdrafts into account the APR for them would be pretty horrendous too.
We could of course return the the good old days of the loan shark, break a few bones if you don't pay etc.
We could of course return the the good old days of the loan shark, break a few bones if you don't pay etc.
Several here have argued that this initiative will not make much impact, in part because credit unions have been around for ages. They have, its true, but actually - how many people really know anything at all about them and how they work? Not that many, I am guessing.
The Wongas of this world obviously fulfill a niche requirement for short term cash loans. So when people feel the need for a loan of this type, who will they be contacting? The brand they know and recognise, from TV adverts, Football Club sponsorship etc, with its promise of a 15 minute wait period and next to no financial checks, or investigate the locality for a credit union and then figure out whats needed to get a loan from them?
If the church are to succeed in this, they will need to generate a much higher brand awareness for CUs, and make them more accessible....
The Wongas of this world obviously fulfill a niche requirement for short term cash loans. So when people feel the need for a loan of this type, who will they be contacting? The brand they know and recognise, from TV adverts, Football Club sponsorship etc, with its promise of a 15 minute wait period and next to no financial checks, or investigate the locality for a credit union and then figure out whats needed to get a loan from them?
If the church are to succeed in this, they will need to generate a much higher brand awareness for CUs, and make them more accessible....
Wonga and their ilk spend huge amounts on advertising and in 2011 made over £100 million profit.
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The key to this sucess has been an ability to accurately predict who will and who will not pay back loans.
*If* credit unions can do the same with minimal advertising and on a not-for-profit basis - they really could have a major effect.
Of course Wonga's backers have donated hundreds of thousands to the Tory Party and one of DC's top advisors left for a job with them.
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So it's going to be an uphill struggle
Still the EU may help - it was them that kicked off the current review of pay-day lenders. We'd have been waiting a long time for the Government to do it off their own backs with that sort of relationship
https:/
The key to this sucess has been an ability to accurately predict who will and who will not pay back loans.
*If* credit unions can do the same with minimal advertising and on a not-for-profit basis - they really could have a major effect.
Of course Wonga's backers have donated hundreds of thousands to the Tory Party and one of DC's top advisors left for a job with them.
http://
So it's going to be an uphill struggle
Still the EU may help - it was them that kicked off the current review of pay-day lenders. We'd have been waiting a long time for the Government to do it off their own backs with that sort of relationship
Wonga make money from people NOT paying their loans off in time, not from the ones who do. That why so much interest is charged. I repeat, these companies are nothing less than loan sharks, and the relevant Ministry should have regulated them properly right from the start. 1000's of percentage interest can never be OK.
Shysters, all of them.
Shysters, all of them.
// do they lend to people with terrible credit records? //
No they don't. When you join a Credit Union, you become a shareholder of it. You must save (usually for a minimum of 3 months and you are then allowed to borrow up to 3 times that amount. So you must prove you can make weekly payments before you get any money, and the amount loaned is based on your ability to pay it back.
Their default rate is less than most high street banks.
No they don't. When you join a Credit Union, you become a shareholder of it. You must save (usually for a minimum of 3 months and you are then allowed to borrow up to 3 times that amount. So you must prove you can make weekly payments before you get any money, and the amount loaned is based on your ability to pay it back.
Their default rate is less than most high street banks.
not sure if anyone heard this on the news last evening, it's funny in a way
The Archbishop of Canterbury is "furious" after learning the Church of England invests in a key financial backer of Wonga, Sky sources say.
The Most Rev Justin Welby has made no secret of his opposition to the payday loans firm and had earlier said he wanted to "compete" it out of business by expanding the reach of the Church's credit unions.
But now a link has been found between the Church and the very company that lies within the Archbishop's sights.
The Financial Times reports that the CofE's pension fund has put money into Accel Partners, a US venture capital firm that led Wonga's 2009 fund-raising efforts.
The fund claims to have a strong ethical investment policy that bans firms involved in payday lending.
A Church spokesman said an investigation would be launched.
The Archbishop of Canterbury is "furious" after learning the Church of England invests in a key financial backer of Wonga, Sky sources say.
The Most Rev Justin Welby has made no secret of his opposition to the payday loans firm and had earlier said he wanted to "compete" it out of business by expanding the reach of the Church's credit unions.
But now a link has been found between the Church and the very company that lies within the Archbishop's sights.
The Financial Times reports that the CofE's pension fund has put money into Accel Partners, a US venture capital firm that led Wonga's 2009 fund-raising efforts.
The fund claims to have a strong ethical investment policy that bans firms involved in payday lending.
A Church spokesman said an investigation would be launched.
