Payday lender Wonga yesterday named former RSA Insurance group chief executive Andy Haste as chairman, who vowed to keep the company in line with tougher rules being imposed the loans industry.
Haste replaces former chair and co-founder Errol Damelin, who announced his departure last month. Wonga and other short-term lenders have come under increasing scrutiny from politicians and regulators over their high interest rates, which can cause hardship for customers.
Haste, who led RSA for eight years until 2011 and sits on the ITV board, said the payday loan industry was going through big changes and promised to keep Wonga compliant.
“Priority number one is to make sure we aren’t lending where we shouldn’t. When we do lend we need to make sure that’s conducted in a responsible and transparent manner that focuses on great outcomes for our customers. That will probably lead to a tightening of our lending criteria,” Haste told City A.M. yesterday.
The Financial Conduct Authority is expected to publish proposals for an interest rate cap on payday loans later this week. Haste said he would support and look to work within any caps imposed.
PROFILE: ANDY HASTE
Andy Haste served as chief executive of RSA Insurance from 2003 to 2011.
Following his departure he was linked with the top job at Aviva, after chief executive Andrew Moss stepped down in 2012, and with a possible bid with a group of private equity firms for RBS’s insurance arm Direct Line Group, prior to its flotation.
Previously, Haste served as chief of AXA Sun Life from 1999 to 2003 and GE Capital Global Consumer Finance UK from 1996 to 1998. After stepping down from RSA, Haste said at the time he had “no immediate plans” plans to return to work.
“It's really from that experience that I know there is a real demand for short-term credit. But I’m also extremely clear that the sector and Wonga within the sector, is a business that needs significant change if it is to have a stable future,” Haste told City A.M. on his decision to return to work yesterday. “Our shareholders and board have given me a very clear mandate to make those changes.”