By Mark Kleinman, City Editor
The payday lending group Wonga will on Friday attempt to begin changing public perceptions of its business model following a vow by the Archbishop of Canterbury to "compete it out of existence".
Sky News has seen a copy of an advertisement that Wonga will place in a number of national newspapers, in which the company will set out 'ten commitments' about its lending practices.
Among the pledges to be made by the payday lender are that it welcomes competition, would "always help customers in financial difficulty" and that it would never charge interest at an annual percentage rate running into the thousands.
The description of Wonga's manifesto as its 'ten commitments' is understood to be a tongue-in-cheek riposte to the Archbishop but follows a bruising period for Wonga and the wider industry.
Last month, the sector was referred to the Competition Commission amid political anger about the activities of some short-term lenders.
The row was stoked on Thursday when comments made by Justin Welby, the Archbishop of Canterbury, were published in the magazine Total Politics.
Referring to a meeting that he had held with Errol Damelin, the chief executive of Wonga, several weeks ago, Dr Welby said:
"We had a very good conversation and I said to him quite bluntly 'we're not in the business of trying to legislate you out of existence, we're trying to compete you out of existence'. He's a businessman, he took that well."
The Archbishop was referring to the emerging credit union movement, a form of financial co-operative which lends money at comparatively low rates.
However, the Church of England faced being embarrassed by the debate on Thursday night when it emerged that its pension fund was an investor in one of the funds that helped to establish Wonga in the UK.
Wonga has sought to counter mounting criticism by pointing out that it only lends money to consumers who have been subjected to credit-checks, and that customers can repay loans early with no additional charge.
In remarks to be published on its website on Friday, Wonga is expected to say: "Since 2007 Wonga has responsibly lent over £2bn and we now have over a million customers.
"We've done that despite declining three quarters of all first loan applications and ensuring a principal default rate (money lent that we don't get back) of around 7%. This is comparable to other forms of short-term credit, such as credit cards.
"We work hard to lend only to the people who can pay us back, and our mainstream services for individuals and businesses are now available across three continents."
Wonga has also been caught up in a row over the refusal of Papiss Cisse, the Newcastle United striker and practising Muslim, to wear a shirt bearing the name of the payday lender, which is the club's sponsor. He has now agreed to do so, Newcastle announced on Thursday.
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