Wonga stops accepting new loan requests because the lender is too high to collapse
- Wonga & # 39; continues to review the options & # 39; but does not accept new applications
- Existing customers can still use their services to manage loans, according to the company
Emily Hardy because this is money
Attacked payday lender Wonga has stopped applying for new loans, which increases the fear that it is about to be managed.
In a statement on its website, the company said: & # 39; While it continues to review its options, Wonga has decided to stop applying for loans.
& # 39; If you are an existing customer, you can continue to use our services to manage your loan. & # 39;
It is thought that the company will announce its future later on Thursday.
Wonga said in a message on her website that it has stopped accepting new loans
The move comes days after it emerged that the company had put Grant Thornton in line to act as a manager in the event that the bank of the lender decides that it can not be rescued.
Wonga held emergency talks on Wednesday with the Financial Conduct Authority (FCA) about the impact of the collapse on existing customers, and on the weekend Wonga said it would consider all options & # 39 ;.
Just a few weeks ago, shareholders – including Balderton Capital, Accel Partners and 83North – have pumped £ 10 million into the company to prevent the company from going bankrupt.
Wonga, which whistled on a stock market only five years ago, has been hit by stricter regulations on lending and a peak in claims for damages.
The company accused claims management companies of the turnout, but said it was making progress against a transformation plan drawn up for the company.
If Wonga goes bankrupt, thousands of mis-selling victims who claim compensation from the company at the moment can leave nothing behind.
Wonga has been hit by a peak in claims for damages and stricter regulations
They are expected to join a row of creditors who are looking for the money they owe.
Wonga's most recent accounts show that £ 108.6 million was due by the end of 2016 – double the year before.
Wonga scaled the levels in the aftermath of the credit crisis when a flurry of struggling consumers closed short loans.
But the company has to deal with a barrage of criticism on the high interest rate it charges on its loans and it is accused of targeting those who are vulnerable.
In 2014, the company introduced a new management team and eliminated £ 220 million in debt of 330,000 customers after they had admitted to having provided loans to people who could not afford to pay them back.
In the same year, the FCA said it would increase the affordability of the checks to the industry and introduce a ceiling for the cost of flash credits on the loan amount per day.