Tag Archives: Wonga

How the Church of England should compete with Wonga

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Wonga makes short term loans to people at exorbitant rates. The idea is that the loan is repaid on payday: it is a payday loan company.

Justin Welby wants to “compete Wonga out of business” by creating church assisted credit unions. The problem is, it will take ten years to accomplish; meanwhile Wonga is approving 10,400 loans a day and makes £1.2million a week in profit now.

After lending more than a £1billion in a year for the first time, it now plans to expand by encouraging customers to buy luxuries they would otherwise struggle to afford.

Its ‘Pay Later’ deal allows borrowers to buy ‘higher value goods’, such as furniture or a dishwasher, for up to £1,000, with an up-front charge of 7 per cent of the price.

The idea of buying luxuries we “would otherwise struggle to afford” was not a problem that afflicted my family as I was growing up. Post-war rationing made ½ a pound of butter a luxury, afford it or not; my parent’s lives were not so devoid of meaning that they felt the need to fill the emptiness with “luxuries they would otherwise struggle to afford.” Not so for many people today, I fear.

In trying to set up competing credit unions, the Church of England is foolishly engaged in trying to beat the world at its own game: for some reason, it will keep doing this – possibly because it has forgotten what its own game is – and it always fails.

If Justin Welby really wants to compete with Wonga, preach the Gospel – the real Gospel – and give people meaning and purpose in their lives so that they don’t have to yield to the impulse of attempting to fill their vacuous existence with luxuries that they don’t need, can’t afford and won’t satisfy.

Winchester Cathedral awarded £10.5m lottery money

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From here:

Winchester Cathedral is one of several sites receiving multi-million pound awards from the Heritage Lottery Fund.

A total of £47m is being shared among six heritage tourism projects in England and Wales aimed at improving visitor experience and developing their potential as tourist attractions.

The Heritage Lottery Fund gets its money from National Lottery Good Causes which gets its money from The National Lottery which, like every other lottery, is a scam that cheats people out of their money by promising them a chance – slightly less than that of being struck by lightning twice – of winning a fortune.

Wonga has something to learn from this: donate substantial sums to cathedral renovations and the pious tut-tutting from elevated ecclesiastical quarters will be replaced by:

The support of the Heritage Lottery Wonga Usury Fund is very exciting as it will enable the Cathedral both to maintain its fabric and to fulfil its potential with a fresh burst of energy and dynamism in our own generation.

Worsening Wonga-gate

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It seems that the Church of England has investments not only in Wonga but in gambling, tobacco, pornography and arms dealing, not to mention alcohol – I expect that is just communion wine, though.

I think that the real problem is not so much what the church invests in, but how much it has to invest in the first place. An organisation that wastes no opportunity to heap opprobrium on a secular government for not doing enough for the poor, is sitting on £5.2billion which, instead of distributing to the poor, it invests, taking advantage of the capitalist system of which it disapproves, at the highest possible interest rate, all the while venting its indignation on Wonga for – that’s right – charging the highest possible interest rate.

From here:

It also emerged that the Church’s ‘ethical’ rules allow it to invest its £5.2billion assets in firms involved in gambling, tobacco and alcohol.

Even firms involved in arms dealing, pornography and human cloning are not barred from receiving Church investment.

The Archbishop confirmed the Church had a £75,000 stake in US venture capital firm Accel Partners, which injected capital into Wonga in 2009.

Wonga arrives in Canada to the sound of Justin Welby gnashing his teeth

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I’d never heard of Wonga until today but, thanks to the free advertising provided by Justin Welby, I’ve not only heard of the company but discovered that it now has a Canadian branch.

The Archbishop of Canterbury – eager to set the world to rights, presumably because it looks easier than setting his church to rights – was furious to discover that, having denounced Wonga, the CofE has indirect investments in it; Wonga is a short term loan company with outrageous interest rates.

Investing in Wonga is, according to Anglican lights, not ethical, implying that Wonga itself is not ethical. The reason, I imagine, is Wonga’s interest rates: if you borrow $500 from Wonga and repay it in one month, you will have to repay $600 – 20% interest per month. That is atrociously high; but unethical? Surely it would only be unethical if the actual interest rate were concealed from the hapless borrower until it was time to repay.

When does an interest rate cross the threshold from ethical to unethical? A credit card company’s 1.5% per month is still high but it doesn’t seem to have met the Anglican criterion needed for ritual excoriation.

Justin Welby clearly doesn’t think charging interest on a loan is inherently unethical because he wants to set up credit unions in competition with Wonga. They will still charge interest but they won’t make a profit.

So profit – or capitalism, really – is the enemy.

Here we go again: another Archbishop of Canterbury who hates capitalism.