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Wonga uses cloud to disrupt financial market

Tue 8 Apr 2014

25/2/14 – Wonga’s CIO discusses how the company uses clever IT to innovate and automate to steal a march on slow competitors and deliver a sharper service

Regarded by many as just a pay-day loan company, Wonga believes it is a technology-based finance company. And its approach to technology could yet be a catalyst in a shake up of the financial industry’s approach to IT.

Jonathan Galore, its chief technology officer, spoke to TheStack ahead of his presentation at Cloud Expo Europe 2014. “It’s before my time here, but when we started the cloud didn’t really exist so we were mainly using a few racks in a colocation data centre,” said Galore. “As we are moving to a continuous delivery model, we need a more robust, secure and elastic architecture.

“We are not in the physical infrastructure business, it is not something we should be experts in. We have been migrating to the cloud – starting with development – because it also offers better management of our overhead and a more flexible and efficient development environment.”

It may not be in to infrastructure, but it is a technology company, he said. “We try to automate as much as possible and there are some 200 people in the development team helping to deliver that. We create the technology which enables the business to work. And if we can’t automate it we will probably look to outsource it.”

He said that one of the reasons he wanted to talk to the Cloud Expo Europe audience was to help get that message across. “I want high visibility of the company as an engineering group – that will help me in attracting great talent,” he said.

There is little doubt that Wonga has been disrupting the financial services market by profitably offering clever, customer-friendly access to money. It has some 1m customers and around 3/4m have the Wonga app on their smartphone.

Surprisingly perhaps, Wonga also rejects around 60% of applications. Much of the loan decision-making is automated and it draws from a number of information sources such as traditional credit checks but the algorithms also look at less conventional areas such as the prospect’s behaviour on the site when deciding to approve a loan. In 2012 it launched a loan service for businesses which while having higher values and longer terms, is essentially offers the same service.

Errol Damelin, Wonga’s founder and CEO, has described Wonga as being the equivalent of iTunes for the financial world. “Wonga is a platform for the future of financial services, the digital revolution has not yet begun in financial services,” he said in a BBC interview.

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