Exclusive figures obtained by Moneywise reveal that complaints handler Resolver saw a 3,378% increase in Wonga cases between 2014 and 2018.
The troubled lender collapsed into administration last night and is unable to finance thousands of compensation claims for mis-sold loans.
The company had been loss-making for several years. It has struggled since 2014 when the Financial Conduct Authority (FCA), the financial watchdog, ordered it to pay £2.6 million in compensation to 45,000 customers. Wonga was found to have sold loans to people who could not afford their excessive interest rates.
For example, there were instances where the annual interest rates on loans totalled 5,853%.
Online complaints tool Resolver, which handles compensation claims for free, has seen a meteoric increase in complaints against Wonga since 2014.
Around a third of these complaints centred on loan affordability and customers received a £1,265 payout on average.
Martyn James, head of media and marketing at Resolver, says: “For years, people who had been ruthlessly exploited by payday lenders didn't feel that they could make a complaint. There was a shame factor around taking out the loans and the aggressive actions of some lenders intimidated some into backing down.”
He adds that the huge rise in complaints amongst Wonga’s customers could be viewed as a sign that people are turning away from claims management companies who can charge a fee of up to 30%.
Consumers who are pursuing a complaint with Wonga may still receive a payout for interest and excessive charges, as the administration process can take time.
If you have an outstanding complaint with Wonga for irresponsible lending, their staff should continue to look at it while the administration process is underway. To speed things up, complainants should specify that they wish to resolve the complaint.
“If you've not made a complaint, then now is the time to do so. Most people who had payday loans had multiple loans, so chances are at least one of those businesses are still operating. So cut and paste the same complaint to everyone,” advises Mr James.