Business & Economy

Monday, 16 April 2018 13:22

Wonga – Not Just A Payday Lender

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Wonga – Not Just A Payday Lender

Wonga’s personal loan product 

You may think of Wonga as simply being a short term lender, offering a one size fits all payday loan product, with a typical term of 30 days. That’s all changed with Wonga South Africa now also offering personal loans, with repayment terms of up to six months. 

So how much can I borrow and how much does it cost to repay? 

New customers can borrow up to R4000, and existing customers up to R8000. The amount borrowed, plus interest, is then repaid in monthly instalments. Because of this, personal loans are sometimes known as ‘instalment loans’. 

For example, if you borrow R4000 over six months, the total amount you would need to pay, inclusive of interest and fees, would be R5400. In each of the six months, you would make a repayment of R900. 

Compare this to the situation were you to borrow R4000 for 30 days, in which case you would make a single repayment of R4735 at the end of the term.  

What are the advantages of the six month personal loans? 

The new six-month Wonga loans are designed to offer greater flexibility to borrowers. As with the traditional one-month payday loan, they are intended for people who need rapid access to credit. However, they avoid the need to commit to longer-term repayment arrangements – many personal loans available in the market have repayment terms of between one and five years. 

What if I want a shorter term loan? 

Whilst these loans are available with terms of up to six months, you can still select a shorter term, say three or four months, if this suits you better. 

Wonga also encourages customers to pay off their loans early if they have the means to do so. By clearing your six-month loan in just four months, you can keep your interest payments to a minimum. 

How do I apply for a Wonga personal loan? 

To apply for a Wonga personal loan, all you need is: 

  • A cellphone number
  • An SA ID number
  • Bank account details
  • Last three months proof of income 

As with Wonga’s payday loans, the process of applying for a personal loan is fast and simple, with the online application taking only a few minutes to complete. 

Important reading for interested customers 

A payday loan or a personal loan can provide relief from short-term financial difficulties. However, like payday loans, personal loans should not be taken out if: 

  • You are seeking to address long-term financial difficulties
  • The loan is intended to manage your existing debt
  • You are not confident you will be able to make the required repayments 

As with any loan, if you fail to make the required repayments on a personal loan, you can expect to be charged late payment fees, and you should expect your credit rating to be affected. 

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