Wonga is cutting a third of its jobs. Here's why

Beleaguered payday lender Wonga is planning to cull 325 jobs, more than a third of its workforce, in a bid to save £25m.

The payday lender is closing its offices in Dublin and Tel Aviv.

The news comes as the Financial Conduct Authority (FCA) ruled that borrowers will never have to pay back more in fees and interest than the value of the loan.

Wonga has also announced the sale of its Everline division which lends to small businesses. Robin Klein, Wonga’s former chairman who was on the board for over eight years, is also stepping down.

Wonga’s troubles began when it sent fake legal notices to over 45,000 customers to chase outstanding debts.

In June 2014, after the FCA took over regulation of payday lenders, Wonga was ordered to pay £2.6m in compensation to affected customers.

In a statement, Wonga’s new chairman Andy Haste said: “Wonga can no longer sustain its high cost base. We’ve had to take tough but necessary decisions about the size of our workforce.”