The Archbishop of Canterbury ‘Competes’ with Payday Lenders
The news broke five years ago in 2013 that the Archbishop of Canterbury Justin Welby has vowed to go to war with payday lenders, especially Wonga which has now gone into administration.
But now, just over 90 per cent of Anglican churches have publically disagreed with the Archbishop of Canterbury’s plan to compete with the payday lending industry.
In 2013, the Archbishop of Canterbury warned the head of Wonga: “We’re trying to compete you out of existence”. He then went onto explain that the CofE would use its 16,000 churches to provide consumer-friendly credit unions with a foothold in each high street.
The Churches Mission
However, come 2018 the Church published its ‘statistics for mission’. In this, it showed that last year only 1,139 churches were involved in ‘money matters and debt advice’ developments.
The figures from 13,000 of the churches showed that 2,347 provide night shelters for the Homeless, almost 3,000 run a ‘community café’, 4,191 of those have a parent and toddler ground and just under 8,000 work with food charities.
Archbishop Welby stated: “From food banks to debt counselling and lunch clubs to language classes, these figures spell out for the first time the sheer scale and range of our churches’ commitment to their communities. We are doing more to love and help people in need than at any time since 1945.”
This mission started back in 2013 where he had said: “We’re putting our money where our mouth is – starting a Church of England staff credit union.” However, its credit unions only lends to church staff and clergy.
Shareholder of Wonga
The battle against Wonga was undermined when Wonga collapsed and it was revealed that the Church of England was actually a shareholder of the lender much to the dismay of many members of the Church.
To run salt in the wound, the Archbishop of Canterbury said in a speech that Amazon and other online giants have been failing to pay workers a living wage and they were extorting taxpayer by paying minimal taxes. However, it was revealed by the Daily Mail that the Church of England had actually invested millions of pounds into Amazon, who they were so heavily criticising.
Wonga going into administration
Wonga has recently been forced to go into administration after a number of years of profit loss and higher demand for payday loans direct lenders. The lender had stopped taking on new loan applications as they found themselves on the brink of collapse.
It is without a doubt that Wonga was the leading lender in the payday lending industry, an innovative force which popularised the quick & instant loan system. They would promise to provide the borrower money in a matter of hours in exchange for extremely high-interest rates. The FCA enforced stricter rules on the loans industry which meant that Wonga could no longer successfully made profit this way, which led to their downfall.
In late August of 2018, Wonga held emergency talks which the Financial Conduct Authority (FCA) about what the impact of their demise would mean for their existing customers. Furthermore, it was unclear what it would mean for the investors of Wonga, which included Balderton Capital, Accel Partners and 83North – who combined assisted Wonga with a £10 million bailout.