» » » What exactly is a Wonga loan?

Type the word ‘Wonga’ into an online dictionary or thesaurus and you will be told it does not exist.  So we know that the word is not something that you will find used in everyday conversation.  However, type the word ‘Wonga’ into any search engine and you will find a vast assortment of responses, relating to the words ‘pay day loan,’ ‘short term loan’, ’10 minute loan’ or something very similar.  You may be thinking well that is all well and good, but what exactly is this type of loan all about and how does it work?  Moreover, should I use one and how do I get one?

In simple terms, loans like the ones from wonga.com are meant to be used over short periods and for small amounts of money.  If you are new to the world of finance and borrowings, and maybe have never borrowed money before, even the words can sound scary and you may be feeling slightly out of your depth.  Like everything in life though there is a right time and a wrong time to use something.  Loans like this are fine and above board if you use a reputable company and adhere correctly to the terms of borrowing.

What exactly is a Wonga loan?

But under what circumstances may you need this type of loan?  Well let’s look at a couple of imaginary scenarios.  Your best friend has suddenly got engaged and you have been invited to the celebration party.  You need a present for the happy couple but find yourself totally spent out until the end of the month.  Do you suffer the embarrassment and tell your friend that the present will have to be a belated one or do you borrow £50 from a company like Wonga, pay it back on pay-day and save face?

Or here’s another possibility.  You’ve just been called for an interview for your dream job.  Again, payday is a few days away but you desperately need a new suit to make you look the part.  You are sure that if you look right for the job, you will get it.  Do you borrow £100, get the suit and get the job or go in your old well-worn office clothes and hope for the best?  (Knowing of course that if you do not look your best you may not perform at your best).

Are you getting the idea now?  The recipe for these types of loans is amazingly simple. Borrow low.  Make the period of time as short as possible.  Pay back on or before the due date.  Problem solved and no borrowings piling up to tie you in knots.  With these loans you borrow – pay back.  Loan is wiped out.  If used cautiously and in moderation only when you really need to, these types of loans can do a lot more than save your bacon!  You can accomplish what you need to do and know that once you have paid back what you have borrowed, your slate will be clear again.  It will cost you a few pounds in interest and charges but it could be just what you need to get through a tight patch.

About Denny Jones

Hi there! I am Denny, a personal finance blogger and I love to share tips related to managing finance for a better living. Follow my blog for lots of fresh and exciting tactics to control your finances.
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