June 13, 2014 / 12:20 PM / in 4 years

Founder quits UK payday lender Wonga

LONDON, June 13 (Reuters) - British payday lender Wonga said its co-founder Errol Damelin had quit as a director of the company, just seven months after stepping down as chief executive.

Wonga is one of the biggest short-term lenders in Britain and has come under fire, along with the industry as a whole, for the high level of interest rates it charges.

Its rates can equate to as much as 5,853 percent a year, though its loans are only supposed to be held for a short period of time, often to provide funds for someone until they are paid.

Britain’s financial regulator is planning to impose tougher rules on the industry.

Wonga said on Friday Damelin, who co-founded the company in 2006, had indicated in November he wanted to begin an orderly exit from the firm so he could start working on new business ventures. He stepped aside as chief executive at that time and became chairman.

“He is now happy that the migration to a senior team suited to running a large and regulated financial services business is well underway and sufficiently advanced for him to step aside,” Wonga said in a statement.

Wonga said last week its CEO Niall Wass, who took over from Damelin in November, was quitting to take a position with another company. (Reporting by Steve Slater; Editing by David Holmes)

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