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The fact that the payments are interest free makes it clear that they make their money by people failing to make their payments on time and paying a presumably
by quietbritishjim 5y ago
The fact that the payments are interest free makes it clear that they make their money by people failing to make their payments on time and paying a presumably high (and certainly unstated in that box) penalty rate. In other words, the goal is to direct vulnerable people at a predatory loan shark. That's hardly a useful feature, no matter how it's implemented.
- TheCoelacanth 5y ago"Interest-free" is at best misleading and arguably an outright lie. There is a $4 fee to take out the loan. While a flat fee is not interest in the strictest terms, if they were using APR, which is the standard way of talking about interest rates for consumer loans, it would be a non-zero rate.
- rurp 5y agoTo make it even worse it's only interest free if the payments are made on time. I'm sure the business model expects a certain amount of people to miss a payment and end up owing credit card level interest amounts, on top of the initial fee. This is extremely scummy.