UK:70% Interest Credit Card Aimed at Poor:How do these scum sleep at nite?

[UdoKier]

Just to be very clear, this company is in the U. K.

http://money.guardian.co.uk/news_/story/0,1456,1411444,00.html


Up to 70% interest - credit card aimed at the poor

Patrick Collinson
Saturday February 12, 2005
The Guardian

A new credit card aimed at millions of low-income families is to charge interest at up to 70% - the highest ever charged by a credit card company.

Marketed under the slogan: "Stay in control of your budgeting", the typical interest rate on the new Vanquis card will be 49.9%, but for some customers the company judge as high risk, it will be 69.5%. MPs and debt campaigners yesterday condemned the rate, which is 15 times the Bank of England base rate and triple the standard rate on other cards. The card also has an annual fee of £19.


SO. FUCKING. EVIL. People who run companies like this, or who knowingly invest in them should be lined up before a firing squad.

[Strawman]

1. Sadly that's better interest than those horrible Payday advance places

Those places are the worst.

[blurp]

15. And it's much better than GETTING YOUR LEGS BROKEN

And I'm very serious about this.

If the poor don't have a legal option, they'll take an illegal option.

And yes, they'll get hurt much worse.

The most they risk with these cards is bankruptcy.

The most they risk with loan sharks is death.

[UdoKier]

19. 30, 50 or 70% is inexcusable

That kind of interest rate is NOT necessary to make a buck, even off of "high-risk" borrowers. It's called predatory lending, and it is wrong.

[blurp]

20. Declaring it "inexcusable" changes nothing. And how hell do you know?

Lenders of all sorts take a gamble when they give money away. If you gamble wrong, you go out of business. If you charge too much for your money and borrowers go elsewhere, you go out of business.

The statistics may be that certain people do justify even 70% interest rates. You're not a lender and you have no idea what interest rate is necessary to make a buck.

But don't let that stop you from making clueless pronouncements about a business you don't understand.

It's people like you that will get poor people killed.

All because you cry "but i FEEL it's wrong!"

It's the same thinking that kills prostitutes and drug addicts. You think by making something illegal it will just go away. It doesn't.

[UdoKier]

21. LOL. Now I'm KILLING the poor.

How many people have committed SUICIDE because of the bind they inevitably end up in due to companies like this?


It has been an established position of the VAST MAJORITY of progressives to OPPOSE usury and predatory lending. It's not about my feelings, it's the facts that back me up.

You needn't reply to this message. I know your kind and want nothing to do with you.

[blurp]

22. I guess that means you've never been poor. Thanks for "helping" us.

How many people have committed SUICIDE because of the bind they inevitably end up in due to companies like this?

Oh, I suppose that's worse than actually being killed by a loan shark.

I know your kind and want nothing to do with you.

Yeah and I know your kind, too.

You've never been poor and have no clue what it's like to be poor. I have.

I remember being woken up one Sunday morning to an argument between a mother and sister about how much money could be made through prostitution.

My father regularly made me borrow cigarettes from the neighbors.

I literally had an enormous hole dug in my back yard so that our landlord could dump garbage there for his tenets. I remember dad coming home telling me how he "gave permission" to the landlord to do this.

I remember how my neighborhood became a dumping place for stolen vehicles which would then be set on fire.

So don't give me any bullshit about how you "know my kind". You don't know shit about me.

[UdoKier]

26. NO. I AM DIRT POOR

NO SAVINGS, NO INSURANCE, TWO KIDS, A PALTRY INCOME, NO HOUSE AND TOO DAMN MUCH CREDIT CARD DEBT.


So don't give ME any bullshit about how you "know my kind". You don't know shit about ME.


Don't act like supporting usury is some sort of compassion for the poor.

[Occulus]

30. Being a 'poor' student is what got me my CC debt in the first place.

By the way, students that age are stupid, but the CC co's prey upon that. Ten years later, I'm still paying that card off- in fact, I had to use it many times during the intervening time.

I've destroyed it; it's not been used for about two years and the account has been deactivated. I'm never using a CC again. A debit card, maybe- there are things I can't do without one, such as shopping online for the best PC hardware deals I can find, for example.

I do not appreciate or approve of the CC co's tactics at all. There ought to be a legal cap on the amount of credit they can extend, and I'd heartily approve of it being applied based on income with a guaranteed minimum at majority age- something like $250 or $500. Enough to establish credit, easily paid off if used responsibly, and one couldn't get too far into the hole before they learn how to use credit wisely. It might even have the long-term benefit of reducing the number of personal bankruptcies due to CC debt.

Not that a CC co would voluntarily do this, oh no. They will only do so if forced.

[Piltdown13]

32. I don't know if they still do this, but

The bank I patronized during college had a college student package that included a credit card with a fixed $500 limit. I think the reason it was pegged at that low amount was because this was a card that you were being issued on your own, with no co-signer, which was the only way I was going to be able to get a card (would NEVER have wanted to ask my folks to be a co-signer). As long as you were in school, that limit absolutely could not be raised (I know, because I called and begged to have a small increase -- I went to school in Boston but lived in Texas, and $500 was sometimes not enough to pay for a plane ticket home back then (this was several years ago before all the really steep discounting started); I once had to put part of the ticket on my credit card and pay for the rest in cash as the travel agency wouldn't take a check -- I doubt if it would be a good idea to do *that* these days!). Once you graduated, the limit went up a little bit, but I'm not sure how quickly that happened as I dropped that bank as fast as I could for other reasons as soon as I found out I could join the credit union at my grad school.

Unfortunately, I don't think that something like this would fly today; it seems that it's no longer as difficult as it used to be even 8-10 years ago for college kids to get a card, and I doubt that they'd respond well to such a low-limit offer. It did make me and my friends who were also on that plan more careful with our money, though; the only ones who got in trouble were the ones who added more credit cards to the mix. (I lucked out on that one; the only other card I used in college was the AmEx card, which in those days ALWAYS had to be paid off at the end of the month -- I got it to solve the plane-ticket problem described above, and that "you HAVE to pay" thing scared me sufficiently that I never got in trouble with it.)

EDITED to say -- I agree with you about setting stricter, income-based limits on what can be loaned. I've got a credit card sitting in my desk drawer right now issued by MBNA (I know, evil company). Those jerks have REPEATEDLY raised my credit limit, despite repeated requests to knock it off, to the point where I now have a $22k-plus credit line with them -- this with a company who I've never declared more than $14k in income (and I'm still a grad student)! Now I'm stuck with the card, which I never use due to its exorbitant interest rate; if I cancelled it, my credit score would take a major hit because my ratio of debt to credit would suddenly drop substantially. Now, *I* never use this card, but I can see where someone who was never given a good financial education might easily overextend him/herself in such a situation.

[Strawman]

24. I agree, 70% is inexcusable

I'm just saying that it's sad that alot of people (including myself at one point) have had to go to those payday advance places that charge interest rates of 700%.

[UdoKier]

27. I've used pawn shops.

But even at my brokest and living in my car, I always stayed clear of the check-cashing payday advance joints. I didn't know their rates were that high, but somehow I knew they couldn't be good..

[WindRavenX]

2. oh my god

Reading shit like this makes me glad I don't have a CC yet...jeesus fucking christ- 70%??????

[Minstrel Boy]

3. And "stay in control of your budgeting" is its slogan?!?

Damn, that's disgusting.

[forintegrity]

4. Aren't their laws against

something like this?

[FloridaPat]

7. If you or I did this it is called usery and is illegal in most states.

But if you're a financial institution that brides the political parties with lots of cash, it's perfectly legal.

[philosophie_en_rose]

8. Maybe not in England.

This would definitely be against the law in the US, because there are special rules for credit card companies. Unfortunately, it doesn't extend to those disgusting Pay Day Advance/ Money tree kind of places. I've been lucky enough never to have to use one, but they're freaking loan sharks.

[serryjw]

5. Unless you pay it off monthly

abd not carry a balance there is no way someone with limited means could afford this.

[KissMeKate]

6. coupled with new bankruptcy laws equals slaves- pure and simple.

eom

[Name removed]

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[Bouncy Ball]

13. It's called Advanced Search

you do it with the screen name. Then you can read every single post a person has ever written at DU.

You've got quite the track record. Enjoy your stay!

[Name removed]

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[Bouncy Ball]

16. Again, it's called Advanced Search.

[UdoKier]

17. You mean the extreme right-wing hotbed, Dallas, Ft. Worth "metroplex"?

nt

[UdoKier]

18. Aw, give the guy a break!

Rich folks bleeding dirt-poor folks dry is hilarious!


<sarcasm off>

[Nimrod]

23. "Are you familiar..."

"With the federal usury laws?"

"Us..ur..y?"

"Oh, silly me, I must have just made up a word. Sign here."

[ReverendDeuce]

25. The company is "Vanquis"? More like "Vanquish"... n/t

n/t

[neweurope]

28. There ought to be laws against this. In Germany this is forbidden.

-------------------

Remember Fallujah

Bush to The Hague!

[SOS]

29. Loan shark rates are here too.

Our Amex "Sign and Travel" was raised to 27.54%, because we were two days late with an unrelated payment.
It's called universal default.
27% in New York State is illegal loan sharking, but since the card company is incorporated in a state without usury laws, it's legal.
We paid it off and enclosed a note to Amex suggesting where they might put their 27% interest rate.
Check your rates on every statement!

[Name removed]

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[Modem Butterfly]

33. On a big pile of money, surrounded by jewels

[Ms. Clio]

34. Why the hell isn't this illegal?

Didn't there used to be laws against usury?