Challenging credit cards
Payday loans company Wonga is challenging the credit card industry and expanding its business into long-term financing for online retail purchases.
The initiative has recently been launched in partnership with outdoor clothing retailer Cotswold. Customers are given the choice of paying for their goods with a Wonga Paylater loan. Unlike the 4,214% APR charged on Wonga’s 30-day deals, the PayLater APR is 27.7%, putting it within the sights of bank-issued credit cards.
Cotswold is so far the only company to have signed up for PayLater with a full-scale implementation expected sometime next year. Wonga claims: “We have always said we intend to develop a range of digital financial services and this product is a credible and innovative alternative to credit cards, enabling people to spread the cost of online shopping but in a short-term and controlled way”.
Whitepapers
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