Wonga old people

Payday loan firm Wonga has had an advert banned in a damning ruling by the Advertising Standards Authority — and not because those puppets are really annoying. The TV spot featured an exchange between two of the firm’s elderly mascots discussing interest rates:

“Right, we’re going to explain the costs of a Wonga short-term loan”

“Some people think they will pay thousands of per cent of interest”

“They won’t of course – that’s just the way annual rates are calculated. Say you borrowed £150 for 18 days, it would cost you £33.49 … Total cost; it’s totally clear.”

Except it wasn’t clear at all.

Wonga’s voiceover and graphics trumpeted their own measures of interest paid by customers but “irresponsibly encouraged viewers to disregard” the representative APR — a whopping 5,853% — a mandatory measure allowing full costs for different loans to be compared.

The ASA ruled against Wonga on all four aspects of 31 complaints received:

  1. that the ad confused interest rates
  2. it claimed a high APR was “irrelevant to a short-term loan”
  3. it trivialised the decision to take out a short-term loan
  4. the representative APR was not sufficiently prominent

The ASA can’t levy fines from advertisers — so Wonga get a slap on the wrist and told not to do it again.

  1. We were always taught that 100% was the maximum of anything,i.e. if you were entitled to 100% compensation,you got all of it. Where do these fictitious percentages come from? Has our language been re invented.

  2. Ah Paul… I see you have no grasp whatsoever of annual percentage rated.

    Excellent…. would you like a loan?

  3. Paul – now lets say you have in your hand 1 apple. And I give you another 2 apples, you now have 3 apples. That is 200% more apples than you started out with. No one has reinvented the language. Whoever taught you was wrong, or you simply didn’t understand.

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