I'm torn on this, I don't know what the break-even rate is on such a loan, but it must be quite high, because the default risk is high. Let's say 150% APR is e

I'm torn on this, I don't know what the break-even rate is on such a loan, but it must be quite high, because the default risk is high. Let's say 150% APR is exactly the break-even rate for this kind of loans to high-risk borrowers, would you say a company writing 150% APR loans is predatory? Obviously it is an atrocious interest rate. But what is the alternative? Unless the government or non-profits step in the make loans at a loss (or hey, direct cash transfers) to the poor, the alternative is no access to credit at all, which is strictly worse. This smells of The Copenhagen Interpretation of Ethics to me: "The Copenhagen Interpretation of Ethics says that when you observe or interact with a problem in any way, you can be blamed for it. At the very least, you are to blame for not doing more. Even if you don’t make the problem worse, even if you make it slightly better, the ethical burden of the problem falls on you as soon as you observe it. In particular, if you interact with a problem and benefit from it, you are a complete monster." https://blog.jaibot.com/the-copenhagen-interpretation-of-ethics/ https://blog.jaibot.com/the-copenhagen-interpretation-of-eth...