Tweet
People making payments on behalf of friends or relatives to payday lenders may be unaware that they could be signing up to pay off future debts. This is because many payday lenders sign customers up to a 'continuous payment authority' when they open an account - this allows lenders to take payments as they become due. One This is Money reader, Sxx-Axx, who did not want to be fully identified, attempted to settle a debt that her sister, Cxx, had with Wonga and ended up hit with repayments for a new loan taken out
Sxx-Axx said she called Wonga but her payment was unsuccessful and instead withdrew the money from a cash machine and gave it to her sister to pay off the payday lender via the bank. 'I tried to use Wonga's automated service, entered my card details and security code but the payment was refused. I have no idea why as I had money in my account.'
Sxx-Axx thought nothing more of the unsuccessful payment until her card was declined in a petrol station. Unbeknown to Sxx-Axx her sister had taken out another payday loan with Wonga and when she had failed to make a payment the firm applied Sxx-Axx card to the account.
The firm then proceeded to take 26 payments adding up to a total of £632, leaving her account empty.....Read more on this story here--: How paying off a friend or relatives payday loan could make you liable for future debts | This is Money
- Hi & Welcome to the AAD Consumer Forum
We're a FREE consumer debt and legal forum offering help, support and debate in many areas of day-to-day life. You will need to Register a Free Account before you can join in with the discussion and contribute with your own posts. Remember to also check out the FAQ's so you can get to grips with how the forum works ready to start posting your new topics. Read about the new GDPR 2018 Rules and how it affects you as a member of AAD.
Wonga says it prides itself on not using aggressive, targeting marketing, but ever since I applied for a Wonga loan, this message keeps returning to hover over my Gmail account inbox: "Payday Cash in 15 mins – Wonga.com/payday-loans - No Phone, No Fax, No Fuss. £400, Instant Decision - Apply Now!"
It's a successful advertising investment because it's become hard to avoid thinking about Wonga each time I check on my emails. The company's policy on extending loans from one month to the next is a key area where Wonga sets itself apart from other payday loan organisations. "We don't roll over loans," says Darryl Bowman, the company's marketing chief, before clarifying that he means Wonga doesn't promote the option of rolling them over. "We are a short-term lender and we encourage you to pay us back, within the time you borrowed, or actually earlier if possible." But it's surprisingly easy to roll loans over from one month to the next (up to a limit of three months), putting off paying the company back, and stacking up more interest and fees each time....Read more here--: My experience with a Wonga loan