wonga

In other words, the asset is Wonga can charge you for perpetuity if you don't repay the money within the agreement, and hence making 5000%+ APR applicable.

Wonga is backed by Index Ventures, who otherwise have a very fine reputation (they are major backers of Dropbox, for example) Companies like Wonga should really be legislated out of existence.

The way payday loan companies like Wonga [3] represent compound interest to target customers.

I'm fairly proud we have some huge ($15 billion dollar) home-grown companies in these areas (even if Wonga is evil).

My opinion on Wonga and other similar companies is that the usury laws which were repealed in the mid 19th century should be reinstated.

People use Wonga because people need very short term loans.

Also, where's the Wonga valuation of $2.5bn sourced from?

But Wonga isn't for lending money for a year.

I don't think that Wonga has a great reputation, I don't like their business, but they are providing a service no one else is.

Now certainly, but not when Wonga started.

In defence of Wonga they seem popular with their million or so users - they have a NetPromotor score of around 70% vs around 0% for the regular UK banking industry.

When I look at my fellow Brits in the UK living on their credit cards and month-to-month on their Wonga loans, I'm starting to realise that the Germans might be onto something.

To be fair to Wonga, I imagine that they try really hard to "scan out people with no hope of repaying the loan".

But my point stands that Wonga's demographic has disposable income, and spends money freely on non essentials.

We did this in the UK, Wonga.com/samedaycash firms everywhere and the government had to legislate to stop them exploiting the poor.

Bizarrely, according to a comment on the linked article, it seems like the person responsible for this is one of the founders of Wonga?