The co-founder of Wonga is to step down as chairman as new rules governing the payday lending industry come in.
Errol Damelin will relinquish the role of chairman in the next few months, according to the Guardian, but will retain a 5% stake in the company.
As the founder of arguably the country’s most well-known payday lenders, the South African is reportedly becoming tired of defending the company against political attacks and public outcry.
Wonga charges interest at 5,853% APR, leading to the “legal loan-sharking” label MP Stella Creasy has given the company in the past.
A source close to Wonga told the Guardian the company’s board had decided that Damelin was no longer the right person to lead the company.
“We will become FCA regulated from Tuesday, the business will be regulated like a mainstream financial services business. With additional investigations, the role of chairman has changed,” the source said.
“We are looking for a financial services heavyweight.”
Read our interview with Damelin.