Payday lender Wonga trebles its 2011 profit

 
City A.M. Reporter
SHORT-TERM loan provider Wonga.com more than trebled its earnings last year, benefiting from a surge in applications by cashstrapped Britons, many of whom have had difficulty obtaining shortterm credit from mainstream banks.

Net income rose 269 per cent to £45.8m with revenue growing at the same rate to £185m, the company said yesterday.

Wonga offers individuals shortterm loans of up to £1,000, which are intended as an alternative to traditional lines of credit such as credit cards and personal loans, and as a means of avoiding unauthorised bank overdrafts. The number of loans provided in 2011 quadrupled to nearly 2.5m, meaning Wonga has now provided more than 6m loans since its launch in 2007.

The firm has faced accusations that its annual percentage rate (APR lending rate), listed on Wonga.com as 4,214 per cent, takes advantage of the financially vulnerable.

Wonga also said 10 times more customers had taken out loans via their mobile phones in 2011 and nearly 1,000 people download a Wonga iPhone app every day.