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Meyer “Mickey” Malka, the founder and general partner of Ribbit Capital, a venture capital firm based in Palo Alto, California, has announced his departure from the board of Wonga, a London based financial technology company. Meyer Malka cited personal reasons for his stepping down from the board. Malka had been with Wonga for three years.
Founded in 2006, Wonga offers consumers “payday” short term unsecured loans online. These loans have been offered at rates that can equate to more than 5000% per annum. This has led to sharp criticism of the company.
After joining Wonga, Mr. Malka had kind words to say about it on the website of Malka’s own Ribbit Capital. Malka said that Wonga is, “showing banks how lending is done, by offering short term financing with dazzling speed, convenience and flexibility.”
Malka leaves less than a moth after one of Wonga’s founders, Errol Damelin, announced that he was stepping down as the company’s chairman.
Mickey Malka is a Latin American businessman, investor and entrepreneur. He was born in 1974 and grew up in Venezuela. In 1993, when he was just nineteen years old and before he graduated from university, Malka had already founded a securities and investment firm called the Heptagon Group. Heptagon services markets in both the U.S. and Venezuela.
Mickey Malka received a bachelor’s degree in economics from the Andres Bello Catholic University in Caracas, Venezuela. Malka was also one of the first people to hold a Wendy’s Hamburgers fast food franchise in Venezuela.
In 1998, Malka started Patagon, an online brokerage firm which offered Internet based financial services. Patagon was eventually sold to the Spanish bank Banco Santander for US $750 million.
Mickey Malka became the interim Chief Executive Officer of Banco Patagon. In 2002 he founded Banco Lemon in Brazil. Banco Lemon was the largest bank in Brazil to service a poorer population and dealt with micro-loans.
In 2007, Malka moved to San Francisco where he founded Bling Nation and served as its Chief Executive Officer. Meyer then transformed Bling Nation into Lemon in 2011. Lemon is a service which helps people to keep track of their expenses.
Lemon was in turn purchased by Life Lock for U.S. $50 million.
In Addition to serving on the board of Wonga, Malka also served on the boards of directors of the Brazilian E commerce company Peixe-Urbano, Mercado Libre and Credit karma, which is an online resource for consumers to track their financial health. Meyer Malka also serves on the board of directors of the Bitcoin Foundation.
Wonga has recently been attacked for its debt collecting practices. It was scolded by England’s Office of Fair Trading in May 2012 for accusing its debtors of fraud.
Wonga has also received criticism from religious figures. Justin Welby, the Archbishop of Canterbury, has called Wonga’s lending rates “shocking and “usurious.” The Archbishop has gone on record as saying that he wants competition to put Wonga out of business. To that end the Church of England is lending its support to credit unions that compete with Wonga.
The British parliament is currently debating legislation that would limit the rates that “payday” lenders charge consumers. Labor Party leader Ed Miliband has coined the phrase “Wonga economy” to refer to predatory “payday” lenders and has accused Wonga of, “targeting children.”
In June 2013, Wonga’s pre-tax profits were quoted as 62.4 million British Pounds.