If Wonga had found breaches in its lending process and taken the initiative in putting things right, they would deserve praise.
The truth seems to be different - behind the great "payday payback" is the Financial Conduct Authority, a powerful watchdog.
The FCA has new powers to regulate the payday sector and what we are seeing today is just the start.
Insiders at the Authority tell me - and I think they are correct - that many lenders are likely to simply leave the market between now and January - either because they cannot or will not apply new rules on checking customers ability to repay.
Wonga will contact all its customers by the end of next week to inform them if they will be among the 375,000 to be included in the redress programme announced today.
ITV News Consumer Editor Chris Choi reports:
Wonga to make changes to its affordability criteria and cancel the debts of those affected by inadequate checks
Wonga will be contacting all customers by 10 October to notify them if they will be included in the payback
Pay-day lender Wonga will write off £220 million owed to it, but the company will only feel the loss of £35 million as the rest is interest on the debts of the 330,000 customers.
Wonga has agreed to write off debts of 330,000 customers who are in arrears of more than 30 days. Move follows review of customer base.
New Chairman of Wonga admits it has been lending money to people who could not afford to repay it. Writing off debts of 330,000 customers.
Wonga Chairman, Andy Haste, promises "real and urgent" change. Henceforth will accept "significantly fewer loan applications".
Wonga is writing off £220 million owed to it but final loss to company only £35 million. Tells you something about interest it charged.
Wonga's new chairman has admitted the company made loans to people who could not afford to repay.
The statement comes after the payday lender's agreed with the financial watchdog to make significant and immediate changes to its business.
Debts for 330,000 customers currently in arrears of more than 30 days will have their loans written off, while 45,000 who are up to 29 days in arrears will be asked to repay without interest and charges over an extended period of four months.
Chairman Andy Haste said: "We want to ensure we only lend to those who can reasonably afford the loan in question and during my review, it became clear to me that this has unfortunately not always been the case.
"I agreed with the concerns expressed by the FCA and as a consequence of our discussions we have committed to taking these actions."
Wonga is to write off the debts of 330,000 customers whose loans would not have been made under new affordability criteria being introduced by the pay-day lender.
Profits at payday lender Wonga more than halved in 2013 because the company was forced to pay £18.8 million in costs over a scandal involving fake legal letters.
In June, Wonga was forced to pay compensation by the Financial Conduct Authority (FCA) after sending legal letters from fake law firms to 45,000 customers.
The payday lender was found guilty of "unfair and misleading debt collection practices".
A 56% rise in operating costs due to investment in staff, infrastructure and its international businesses also contributed to the fall in profits.
Pay-day lender Wonga said it expects that it will be "smaller and less profitable in the near term" after reporting a 53% drop in pre-tax profits to £39.7 million for 2013.
The new chairman of payday lender Wonga has pledged "significant change" after the firm "made mistakes" in sending out letters from fake lawyers to customers in arrears.
ITV News Business Editor Joel Hills confirmed the appointment, tweeting:
Wonga appoints former boss of RSA as new Chairman. Andy Haste says he has mandate for "significant change" and that Wonga "made mistakes".
Andy Haste says he was approached by Greylock - one of Wonga's shareholders - before fake law firm letters made public.
Andy Haste warns that the changes necessary to win full FCA authorisation will make Wonga "a smaller and less profitable business".