Wonga in face-lift as sector crashes

Former Kitcatt Nohr chief Marc Nohr has notched up his first new business win at ad agency Fold7 by scooping the potential “brief from hell” to revive the fortunes of payday loan giant Wonga.
The agency, which recruited Nohr last month, is understood to have beaten off VCCP, The Corner and Saatchi & Saatchi to the account. Incumbent Albion, which devised the controversial pensions puppets, declined to repitch.
Wonga has seen its profits wiped out due to a number of scandals as well as new regulations, and is launching Fold7′s first work under the strapline “credit for the real world”.
Running on TV, radio, print and online, the push has been developed to present “typical” Wonga customers who need a responsible source of short-term credit.
Wonga chief executive Tara Kneafsey claimed the new product features and marketing relaunch “are further proof of the action we’ve taken, and continue to take, to ensure Wonga is lending responsibly and putting customer outcomes first”.
However, the relaunch comes as new figures show complaints about payday lenders have rocketed by 48%, as the market goes into meltdown.
According to the Financial Ombudsman Service annual report, complaints went up from 794 to the year ended March 2014 to 1,157 during the same period in 2015. But speaking on BBC News, MoneySavingExpert.com founder Martin Lewis called the figures a nonsense.
He said: “The [payday loans] industry has created itself out of marketing to try to push the idea that there is a demand. Most people who take out a loan do so because there are late night adverts when they are drinking or gambling becuase they are so desperate for cash that they can’t afford to pay them back.
“The ombudsmen has some nice communication but they ain’t even close to reaching all those people and telling them what their rights are. We know that the industry was systemically giving people loans that they knew they could not afford. There would be tens of thousands of complaints if only people knew how to complain.”
In terms of the number of complaints, the Financial Ombudsman Service says PPI is still head and shoulders above the rest, although 48% down from the previous report, there were still nearly 205,000 complaints – equivalent to nearly 4,000 a week.