Wonga confirms trial sale of debts

January 29, 2013

Charlotte PearceWonga the payday lender has confirmed that it is to trial the sale of its debt to a debt collection agency (DCA). This move if successful could see the business start to sell debts to third parties.

 

Henry Raine, head of regulatory and public affairs at Wonga delivered details on the consideration of selling debts to a DCA. He confirmed that a trial had been negotiated with a DCA during a meeting with the committee of public accounts.

Henry Raine was in front of the committee met to discuss the effectiveness of consumer credit regulation.

When asked whether Wonga sells its debts to other parties for collection, he said ‘we haven’t traditionally done that but we are looking to’

Wonga customers will be notified if their debt is sold.

A committee member voiced a concern over some DCAs ‘aggressive’ practices in relation to debt recovery.

Raine said, ‘Those are still our customers and any action they take has to come through us, for the simple reason that if they mistreat our customers, it will soon become apparent’.

The majority were in agreement that there should be tighter regulation surrounding debt collection.

A number of lenders were in attendance and were grilled by MPs over their business models and practices.

Liberal Democrat MP for Redcar, Ian Swales said ‘Some of the worst stories we hear are not necessarily companies like yours. It’s the companies that might feed off companies like yours’.