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> I assumed and hope all that cash was because they’re actually lending directly. It’s not typical that you lend your own money out, and banking 101 is usually

by Closi 5y ago

> I assumed and hope all that cash was because they’re actually lending directly. It’s not typical that you lend your own money out, and banking 101 is usually that you borrow money from one person (E.g. someone who has a bank account with you that you pay interest) to lend it to another at a premium (and you get the profit between those two figures in return for holding the risk if there is a default). Investors will typically expect a much higher return on their own funds than the loan APR (unless the APR is eye wateringly high). Edit: Apologies I stand corrected - I’ve just looked at the internet archive and it shows rates of up to 1825% APR. These loans are definitely predatory and so could have been done directly from the capital. Not surprised they got shut down, similar companies operating in the UK got shut down years ago and pretty much everyone is better off for it. It’s a hugely predatory industry.

CaptainZapp 5y ago
> I’ve just looked at the internet archive and it shows rates of up to 1825% APR Sheesh, APR on loans in Switzerland - Not exactly known as a socialist hell hole - are capped by law at 15%. Anything above this is usury and a criminal offence.
- Closi 5y ago
  The UK is similar, but splits it across two rules (which allow for higher interest loans but cap the potential impact): * Interest must not exceed 0.8% per day. * The total cost of any loan must not exceed 100% of the original loan amount. (NB: This is only for consumer loans, commercial loans do not have a cap.)
garmaine 5y ago
> I’ve just looked at the internet archive and it shows rates of up to 1825% APR. These loans are definitely predatory and so could have been done directly from the capital. Not surprised they got shut down, similar companies operating in the UK got shut down years ago and pretty much everyone is better off for it. It’s a hugely predatory industry. It is a hugely predatory industry that ought to be shut down. Unfortunately the "payday loan" industry is still 100% legal here in the USA :( It looks like LendUp got shut down for the misleading marketing about their evil lending practices, and not the fact that it was evil in the first place.

by Closi 5y ago

CaptainZapp 5y ago

> I’ve just looked at the internet archive and it shows rates of up to 1825% APR Sheesh, APR on loans in Switzerland - Not exactly known as a socialist hell hole - are capped by law at 15%. Anything above this is usury and a criminal offence.

Closi 5y ago
The UK is similar, but splits it across two rules (which allow for higher interest loans but cap the potential impact): * Interest must not exceed 0.8% per day. * The total cost of any loan must not exceed 100% of the original loan amount. (NB: This is only for consumer loans, commercial loans do not have a cap.)

garmaine 5y ago

> I’ve just looked at the internet archive and it shows rates of up to 1825% APR. These loans are definitely predatory and so could have been done directly from the capital. Not surprised they got shut down, similar companies operating in the UK got shut down years ago and pretty much everyone is better off for it. It’s a hugely predatory industry. It is a hugely predatory industry that ought to be shut down. Unfortunately the "payday loan" industry is still 100% legal here in the USA :( It looks like LendUp got shut down for the misleading marketing about their evil lending practices, and not the fact that it was evil in the first place.