Wonga’s re-brand is here: the payday lender is to roll out new television adverts aimed at its new middle-class target base.
It is also offering a money-back guarantee as part of an image revamp aimed at repairing the reputation damage it suffered during a tumultuous 2014. It will keep the Wonga name, despite speculation about a change in brand title.
The money-back guarantee will allow customers who change their mind within 24 hours to cancel their loans without incurring costs. There will also be a three-day grace period, meaning borrowers who are late on their payments won’t have to pay the old £15 default fee. Interest will stop accumulating on unpaid debts after seven days, a change from the old 30-day system.
Wonga's new target demographic will be the "cash and credit constrained," and its adverts will feature "real world, hard-working people," a change from the geriatric puppets of previous offerings. The re-branding has been on the cards ever since Andy Haste took over as chairman last July. The new television spots will start today, along with radio offerings, and will not be shown alongside programmes known to attract younger audiences. This self-restriction is aimed at preventing adverts "inadvertently attracting the young or vulnerable".
Despite the revamp however, Wonga is retaining its headline 1,509 per cent annual interest rate; the figure that draws the most bile from its critics. Defenders point out that, as no loan is 12 months in duration, borrowers never pay anything like that percentage in interest.
Tara Kneafsey, Wonga’s UK chief executive, said:
Our new product features and today’s marketing re-launch are further proof of the action we’ve taken, and continue to take, to ensure Wonga is lending responsibly and putting customer outcomes first.
Our focus is on serving hard-working people throughout the UK who need access to transparent, flexible and short-term credit products.
During the course of last year Wonga faced accusations it sent fake legal letters to customers struggling to meet payments on loans and ended up forking out £220m to clear the debts of 330,000 borrowers. The concoction of phoney legal firms landed the company in hot water with the FCA, which ordered Wonga to pay £2.6m in compensation to around 45,000 customers.