In the absence of restrictions on interest rates the typical annual percentage rate (APR) for payday loans can be 1,000 percent APR or more. In June 2010 the OFT published a "review of high-cost credit." In this report they concluded that changes could be made to the industry itself, but that "more radical approaches would be required if the Government or others wanted to tackle the wider social, economic and financial context in which high-cost credit markets exist. Wonga has faced widespread criticism over its interest rates, allegedly heavy-handed debt collection methods and its £24 million shirt sponsorship deal with Newcastle United football club that some say will tempt impressionable young fans.In the more recent innovation of online payday loans, consumers complete the loan application online (or in some instances via fax, especially where documentation is required). A small percentage of payday lenders have, in the past, threatened delinquent borrowers with criminal prosecution for check fraud. This practice is illegal in many jurisdictions and has been denounced by the CFSA, the industry's trade association.
