5 ms·

There's an argument that could be made that capitalism is based on the idea that those who understand compound interest are allowed to exploit those who don't.

by neffy 11y ago

There's an argument that could be made that capitalism is based on the idea that those who understand compound interest are allowed to exploit those who don't. So no, you're not the only person who thinks that. And there are plenty of people who want you to keep thinking that. Especially people with bright new financial services apparently aimed at making the wealth gap even worse than it is already. Robbery by math.

Karunamon 11y ago
You and I have tremendously different definitions of robbery. Every legitimate payday loan outfit I've looked at is pretty much above board with what they charge and how they work. Borrow X, repay X + Y on Z date, usually no more than a month in the future. So sure, if you feel fully informed consent is exploitative in any way.
- neffy 11y ago
  And the entire population aced math in their well funded school system with small class numbers and well paid capable teachers, so no worries. I suspect we don't have different definitions of robbery so much, as of when it's appropriate to take advantage of people's ignorance and when it isn't. You'll understand better when somebody has taken advantage of yours.
  - Karunamon 11y ago
    How does this increasingly contrived person who has a job and paychecks/DDs into a bank account (all three of which are prerequisites for most payday loans) not understand first grade math?
    - neffy 11y ago
      Please. The entire existence of Las Vegas is predicated on people who didn't understand high school math.
    - progressive_dad 11y ago
      I'm a perfect use case for this service, so I guess I'll tell you my story. My credit score is pretty low. Low enough that I apply for high interest cards with my bank and get rejected. I have a high income and an equally high number of expenses. Each month I have about 300-600$ in "discretionary" income. I also have a partner with a very low income and a son. My partner is trying to get on her feet right now and there is a high degree in variability with her income and needs. She has recurring medical bills and there are constant one time medical expenditures when you have a child. Not to mention birthdays, once in a lifetime kind of events where your child gets to participate, there are family and friends that are worse off financially and need help from time to time. I don't like, respect, or particularly want to use my banking services. I don't trust them but having a checking account is a requirement. Every time I have 500$ it makes me sick to my stomach to imagine handing it over to them, given the fees and backhanded tactics they use. I don't trust them. I imagine I might get a secured credit card sometime, but handing over the 500$ and waiting two weeks to a month for my own money back, again, just makes me kind of sick. This service would help me in an emergency, and help me build credit (if not to the same extent as a secured credit card)
      - neffy 11y ago
        I totally sympathise, the US health system is just a disaster. YMMV but - I had a US bank account (I was a foreign student, low income) for 10 years. Didn't cost me a cent. Made money on interest, and had a perfect credit rating when I graduated. Found a small community bank that was free provided you kept a minimum balance of $1000. Savings and Loan are an equally valid alternative (not even sure what the difference is got the same service from both - except the S&L would cash foreign checks for free). Thing is, people think banks are evil for charging 14.5% APR for an unsecured personal loan. But they think these guys are great for charging a minimum of 29% APR - but as far as I could see more like 200%+ for an unsecured personal loan??? Holy math fail batman! Don't bank with citizens or bank of america, and do your due diligence like you would any other purchase. There are plenty of good banks out there who would be happy to do business with you. Go in, ask to speak to the bank manager, explain your circumstances, ask questions you already know the answer to to calibrate, and treat it like any other business arrangement. You're right a secured credit card is also better than these guys, they'll only charge you 27%APR or so. Still not as good as a bank.

by neffy 11y ago

Karunamon 11y ago

You and I have tremendously different definitions of robbery. Every legitimate payday loan outfit I've looked at is pretty much above board with what they charge and how they work. Borrow X, repay X + Y on Z date, usually no more than a month in the future. So sure, if you feel fully informed consent is exploitative in any way.

neffy 11y ago
And the entire population aced math in their well funded school system with small class numbers and well paid capable teachers, so no worries. I suspect we don't have different definitions of robbery so much, as of when it's appropriate to take advantage of people's ignorance and when it isn't. You'll understand better when somebody has taken advantage of yours.
- Karunamon 11y ago
  How does this increasingly contrived person who has a job and paychecks/DDs into a bank account (all three of which are prerequisites for most payday loans) not understand first grade math?
  - neffy 11y ago
    Please. The entire existence of Las Vegas is predicated on people who didn't understand high school math.
  - progressive_dad 11y ago
    I'm a perfect use case for this service, so I guess I'll tell you my story. My credit score is pretty low. Low enough that I apply for high interest cards with my bank and get rejected. I have a high income and an equally high number of expenses. Each month I have about 300-600$ in "discretionary" income. I also have a partner with a very low income and a son. My partner is trying to get on her feet right now and there is a high degree in variability with her income and needs. She has recurring medical bills and there are constant one time medical expenditures when you have a child. Not to mention birthdays, once in a lifetime kind of events where your child gets to participate, there are family and friends that are worse off financially and need help from time to time. I don't like, respect, or particularly want to use my banking services. I don't trust them but having a checking account is a requirement. Every time I have 500$ it makes me sick to my stomach to imagine handing it over to them, given the fees and backhanded tactics they use. I don't trust them. I imagine I might get a secured credit card sometime, but handing over the 500$ and waiting two weeks to a month for my own money back, again, just makes me kind of sick. This service would help me in an emergency, and help me build credit (if not to the same extent as a secured credit card)
    - neffy 11y ago
      I totally sympathise, the US health system is just a disaster. YMMV but - I had a US bank account (I was a foreign student, low income) for 10 years. Didn't cost me a cent. Made money on interest, and had a perfect credit rating when I graduated. Found a small community bank that was free provided you kept a minimum balance of $1000. Savings and Loan are an equally valid alternative (not even sure what the difference is got the same service from both - except the S&L would cash foreign checks for free). Thing is, people think banks are evil for charging 14.5% APR for an unsecured personal loan. But they think these guys are great for charging a minimum of 29% APR - but as far as I could see more like 200%+ for an unsecured personal loan??? Holy math fail batman! Don't bank with citizens or bank of america, and do your due diligence like you would any other purchase. There are plenty of good banks out there who would be happy to do business with you. Go in, ask to speak to the bank manager, explain your circumstances, ask questions you already know the answer to to calibrate, and treat it like any other business arrangement. You're right a secured credit card is also better than these guys, they'll only charge you 27%APR or so. Still not as good as a bank.