Monday, 21 September 2009

Instant misery and poverty

Instant loans became big business a couple a years ago here in Finland.

You could, at the beginning when these cash loan firms established themselves on the market, apply for a cash loan, instantly paid to your account in the middle of the night sitting in a bar to settle your check.

This is no more the case, now there are some rules these instant cash loan firms have to apply to, but it seems to me these loans are more like tickets to instant bankruptcy, as the the interest rates are higher than they should be allowed to be, at least according to the law, as profiteering is not allowed here in Finland. You lend 100 Euros for a month, that is 30 days, and you pay back 144 Euros. And what is that in yearly interest rate?!?

At least according to me that makes very much a bigger yearly interest rate than I would even want to think about, just a waste of money...and lending once and not being able to pay it back, you have to lend more to pay and there it is, instant misery and poverty and you did have fun, once long, long time ago.

1 comment:

  1. Hi,
    Just found your blog.

    On the subject of high interest loans: these organizations tend to replace the black market loans that occur without the service. Second, they max out very quickly instead of accumulating forever. Third, they teach people how to be responsible with credit. Fourth, they are generally run by people from the local community.

    The criticism of these companies is usually unfounded upon analysis. THey are highly regulated, and they provide a useful and important public service that would be supplied by the black market if they were suppressed.