Tag Archives: borrow

Why does Wonga even exist? It’s a question no one on the left asks | Zoe Williams | Comment is free | The Guardian

18 Dec

hy does Wonga even exist? It’s a question no one on the left asks | Zoe Williams | Comment is free | The Guardian.

this article came to the wrong conclusion, that it is the fault of low pay.

i think it is the fault of a kind of mentality very prevalent in the west…which is i want it and i want it NOW!

we all think it is only the very poor and desperate who will take up these loans, but it is not so. wonga is very successful, it cannot all be accounted for by the desperate and poor people who cannot get loans elsewhere; many who are working and might be earning a salary that can well cover the minimum costs of their day to day lives, and who can take a loan from their banks, dont want to do so, because of the paperwork, they prefer take out  loans from wonga  because it is hassle free, and  they just dont want to wait till pay day to buy services or goods that they crave. they want it and they want it now.

the article says

The veneer of criticising the corporation – usually Wonga – masks what would otherwise be the straightforward attribution of poverty to stupidity. In this reading, it’s not your fault that you’re at the stupid end of a phenomenally stupid deal; it’s the fault of that cunning organisation. 

and goes on to ask why do these people need these loans, and concluded is it due to low , inadequate pay?

i dont think so. i am sure there will be those cases, but even the well to do, sometimes get cash flow problems, and wonga is a quick answer. it would not surprise me that wonga et al is making such huge profits from these working people who earn an income able to pay back the loan, who dont want to wait to get what they want. perhaps buying in sales where the bargain can be gone if not bought now.

there are lots of reasons why you might need to get hold of money now.

personally i would do without and save up, but that is an old fashioned mind set and shows my age. haha. the young are so used to living on credit, it is nothing to them to be in debt. there is no stigma to being in debt. and the laws are quite lenient to those who are in debt.a bankrupt can be discharged in 2yrs for eg. and credit scoring records are kept for only 6yrs. in fact, if u got a record of borrowing your credit rating is better than someone who never borrows.

what surprised me is that this kindof lending used to be the province of money lenders operating on the shady side of the street. now it is all in the open. how come wonga et al got the license to do so? and the internet makes it international, and lots of people borrowing small amounts (less than £1000) can make for huge profits.

Wonga is a great business model. better than making some product and trying to sell it at a profit. sell money instead. haha.

added. i was thinking in some perverse way it has a lot of logic to it. For eg, let’s say i want £100, so why dont i borrow £115 from wonga, and keep that £15 aside, and spend the £100 . the interest on £115 is £16.35 over 9days.

added. i knew there was a catch. i did not see it at first, but i forgot that you still have to pay back that £100. (correction, pay back that £115). It is really strange, i could see in the website if i borrow £115 i should pay back £131.35. it is clearly spelt out, and yet i chose to not see it. And this is me, who is so careful with money, can be fooled by myself. 

All in all, it really is foolish to borrow money. you can see how easy it is for someone who is naive to think someone is doing this and not making alot of money out of it and you are the idiot who will pay for it. maybe there is some truth to poverty happens to those who are stupid or naive or both.

I am it seems paying them back with their own money…. its a win win… i know there is something wrong there with the logic, but hey, it looks good doesn’t it?

I went into wonga website to get the figures. interesting that they limit my loan to £400 and 31days. so for total strangers, that is the limit. it is like 36%(about £36) interest for the month. so it does not work if u borrow it for that long. 

added 31.12.13 read here about kerry katona,(can’t say i know who she is exactly) talking about her endorsement of a payday loan company. they fired her when she filed for her second bankruptcy. it is rather ironic really that she is endorsing payday loans, and really believe they are ok, and said she will borrow from them if she had to.(this is a case of do the opposite of what she advocates) she gave as an eg if her boiler packed up in winter or your car failed its MOT.  most people would do exactly like as she did, but it goes to show how i think, because i wont borrow money to repair it.  i would rather cope with the cold by wearing warm clothing, drinking hot soup/drinks, eat well, etc rather than repair a central heating which will not only cost me to repair it,  but make me have the heating on and get me to spend even more.If i cannot even afford to repair the boiler, what makes u think i can afford the heating bill!!!

And I would get rid of the car.

i prefer to get rid of that single biggest expenditure and consider it a blessing in disguise that the boiler or car packed up. 

I think having a pay day loan is like you asking the bank for £200 of your own money and that person taking £60 of it and giving you £140 for you to use.  because that is about the interest for 1month’s use of it. If anyone does that u would scream blue murder, but not when a payday loan does it in the name of interest. 

added,maybe she is clever. she filed for bankruptcy twice. she owes the taxman $70,000 .  that means she must have earned at least £200,000 that year. but she  filed for bankruptcy the first time, and dont have to pay it. and she did this twice. I am not saying she did it as a strategy, but if u learn from it,all your debts wiped out … it seems a great way to get a clean slate by using bankruptcy as a way. makes me wonder if i am the sucker for not borrowing money… (just kidding, because i just dont have the temperament for that. )