Payday lender Wonga made more than £1 million per week over 2012 despite the firm being caught up in controversy over its interest rates.
Errol Damelin, CEO and founder of the controversial tech firm, said on Wednesday morning that the company posted £62.5m in record profits, up 36% on the previous year. The huge boost was attributed to an increase in customer numbers and ongoing international expansion.
Meanwhile, the amount of money that was uncollectable by Wonga due to people being unable to pay them back and defaulting rose to 7.4%, up from 6.7% in 2011.
Damelin, who is on a £754,000 salary, said it was a side-effect of an increase in the firm's customer base. The Wonga CEO defended his salary, which is over five times as much as the Prime Minister's, by explaining that it was "in line" with salaries for other private sector business chiefs.
The firm's revenues for 2012 soared by 67% to £309.3 million, with a total of £1.2 billion lent over the year. This marked a 68% increase in the amount of money lent by Wonga, with 4 million loans provided in total.
Damelin confirmed that Wonga would continue to avoid issuing a dividend to shareholders and instead sink its company profits back into growing the business further. The financial services firm saw its net profits triple to £45.8m in 2011 from £12.4m in 2010, while revenue grew to £185m.
Labour MP and anti-payday loans campaigner Stella Creasy blogged on the Huffington Post UK: "Wonga may be celebrating today, but it is our nation's families and our nation's financial future that will pay the price of the Government's failure to end legal loan sharking."
Wonga's financial success comes despite the firm being bogged down in payday loans controversy after Archbishop Justin Welby said he had told Damelin he would "compete [Wonga] out of existence" by supporting rival credit unions.
The remarks sparked an embarrassing climbdown from the Archbishop however when the Church of England's pension fund was found to be an investor in Wonga. The Office for Fair Trading recently announced that 15 out of 50 payday lenders said they would quit the industry after being given a deadline to tighten up their business practises.
In response to criticism, Wonga said on its website: "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."Suggest a correction