The payday lender said it had launched a consultation exercise with staff at risk of redundancy, which will run for 30 days.
Chairman Andy Haste said Wonga will become smaller and less profitable in the near term as it introduces changes to make sure it lends “fairly and responsibly”.
Haste’s cost-cutting plan comes after Wonga’s profits halved last year after the Financial Conduct Authority made it pay £2.6m compensation for sending fake legal letters to customers demanding payment.
“Our focus is on creating a business that meets the demand for short-term credit sustainably and responsibly, resulting in good customer outcomes,” Haste said. “We’ve already made significant changes, including appointing a new leadership team, implementing a new risk decision engine and tightening our lending criteria.
“However, Wonga can no longer sustain its high costbase. Regrettably, this means we’ve had to take tough but necessary decisions about the size of our workforce.
“We appreciate how difficult this period will be for all of our colleagues and we’ll support them throughout the consultation process.”
It is expected the job cuts will be mainly in Wonga’s offices in London, Dublin, Cape Town and Tel Aviv. Wonga also announced that it has agreed to sell Everline, its small business lending brand, to Orange Money.
Tomer Guriel, the chief executive of Orange Money, said: “Collectively we are now the biggest business e-lender in the UK and remain focused on providing more businesses with the finance they need to fuel and sustain growth.”
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