Wonga ad banned for glossing over 5,853% APR
Wonga is in hot water again, this time for an ad that claimed that their flabberghastingly high APR of 5853% wasn’t really that important and you should just forget about it – la la la.
The rubbery puppets of doom are shown ‘simplifying’ the terms of Wonga loans, thus: ‘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.’
BUT, 31 people complained to the ASA, saying that they were misleading customers with a confusing message which encouraged them to disregard their insane interest rates.
Wonga said that they were only trying to give a transparent example of a typical Wonga loan but they regretted confusing customers.
However, the ASA said they understood that APR did not apply for the time period for a short term loan, but banned it anyway, because it irresponsibly encouraged people to take out loans without considering the APR. They said:
‘We considered that, though it attempted to clarify the costs associated with a Wonga loan, the ad created confusion as to the rates that would apply. On that basis, we concluded that the ad was misleading.’
Maybe if Wonga are looking for an example of a representative loan, they could show the puppets struggling to make ends meet and turning to rubbery prostitution to pay it back?