Britain's Wonga: Payday Lender and Proud of It
Summary
London tabloids have characterized Errol Damelin, founder of online lender Wonga.com, as a high-tech loan shark “laughing all the way to the bank.” Incoming Archbishop of Canterbury Justin Welby says Wonga and firms like it violate the biblical ban on usury. That new software scrapes the Web for more than 8,000 data points, including Facebook and LinkedIn activity, and almost two-thirds of online loan applicants are rejected, Damelin says. Bad loans aside, Wonga is considered a top European candidate to go public and would be valued at more than $1 billion this year in the event of a share sale or acquisition, according to technology consultant Magister Advisors. Damelin runs Wonga from a pair of converted Regency houses in London’s leafy Primrose Hill neighborhood with the standard accoutrements of Silicon Valley life—glass-walled meeting rooms, Nespresso machines, and calisthenics sessions. In England, the Financial Conduct Authority, a new government consumer watchdog that will launch later this year, will have the power to cap interest rates on payday lenders.