Should Payday loans be legal?

Hannah_10

I would support both option A and option B, but I am going to comment more on A...

It's not difficult...

barbiedoll wrote: »

Instead of endless property and antiques programmes on the telly in the morning, why can't the BBC make a regular long-running show about personal finance.

barbiedoll wrote: »

As I said before, children should be taught money matters in school

Look at nutritional education. When the public takes an active interest in something then the effects snowball...

Public interest in food and healthy eating has caused...

Jamie Olivers better school dinners for everyone.
The change for life campaign to educate the already-adult population.
Programs such as You Are What You Eat at one extreme, healthy recipies from the chef on breakfast telly at the other end.
I-don't-know-how-many-books.
McDonalds now sell salads!
Better food labelling.
Better education in schools... I will never forget my then 8 year old pointing out that tomatoes can help you to stay pretty longer- I nearly swallowed my tongue! She's right by the way, they had been learning about vitamins/anti-oxidants.

I could go on and on about the revolution in nutritional awareness which has taken place since I left school in 1996 with my Home Ec: Food GCSE! At 16 I was the only person I knew who could tell you what vitamin D was for. Now kids of 8 are telling me!

The revolution in public awareness of this area of thier wellbeing has been driven by public interest. As public interest grows into individual financial wellbeing I think we will see as many different sources of education springing up.

Now is a great time for it too, we are forever being told the economy needs TLC, well that economy depends greatly on what happens inside the homes and minds of individual consumers. If individuals thrive and are able to wisely make use of financial products on the market then the country and economy as a whole thrive.

I think more financial awareness will come, it'll be driven by increasing public interest. MSE is the 8th largest social networking site in Britain. People clearly do want to know this stuff. The financial education campaign for schools is unlikely to end until it's demands are met because so many of us are so firmly convinced we need it. Programs dealing with money issues are getting higher ratings. Personal finance is becomming less of a taboo conversation and we are becomming less superstitious and more informed about our cash.

The conditions are all right for a massive shift in public attitude to take place in the next 5-10 years and I think it's going to.

Monkeyballs

Hi DC,

Again, very valuable points.

Especially the point you make about getting out of debt needing to be a challenge. I agree with you. A common method of getting finances into order does seem to be to move it around, take advantage of various offers etc...

There has to be a cut off point.

I declared myself bankrupt when I was in my late 20's. The debts I'd racked up were, in the most part, due to me being too soft on my long term girlfriend and taking on more and more debt to pay her way while she went through University. That all bit be on the backside and as a result, when we broke up I was left with about £28k of debt on a very low paid job...

I think at the time I was so releived to have the burden of debt taken off my shoulders that the true reality never really sank in.

I have some debt now, small amounts and all managable but I'm only now, as I struggle to repay them, starting to see where I've gone wrong!

All the debts I have are with companies that are either cooperative or I can speak to face to face. This is helping me to realise my situation and stops me from panicing! This is what is missing from these online payday loan lenders.

There is no one to talk it over with, it's just 'pay now, or else'.

Monkeyballs

Hi Hanna,

I love the comparisons you have drawn, you are absolutely right!

There is a huge shift in public perceptions at the moment and talking about finance is becoming more of a common topic of discussion.

If the government was to invest the time and money (may be a moot point at this time I accept) that they have in raising awareness of healthy diets and living then peoples opinions on money, spending and debt would soon change.

Maybe someone should contact the government to highlight that personal debt is a massive contributor to stress... And that helping to educate the public in all things financial will have a similar impact on reducing the number of stress related ilnesses such as anxiety, depression, heart attacks, etc... In addition this would reduce the number of people turning to their GP and hospitals for help, thus cutting the amount spent by the NHS treating the side effects ;-)

Interesting thought...

bottleofred

Hi Monkeyballs,

I've already commented on this and also think DCs comment about if I can't afford £100 this month, then how can I afford £110 next month is an excellent point. However, while some people cash the cheques to get luxuries, others simply cash the cheques to survive. The need for survival and purchase of luxuries is what these companies are banking on hence the exorbitant interest rates. My point though really is that even if the APR was 3000%, those in desperate need would probably still use the service and people who wanted luxuries after careful consideration would probably do the same. The only solution in my opinion is better regulation and a limit on how much you can borrow.

barbiedoll

I agree with DC regarding the "easy" option to get out of debt, it shouldn't be easy, it should be hard, that's (hopefully) how most of us will learn our lesson and not be so eager to spend money that we don't have. There's definitely a need for tighter regulation regarding the activities of some DCA's, these high-pressure tactics take a great toll on many people who, despite being debtors, should not be treated as though they were criminals. (Yes, I know not paying your debts is tantamount to theft etc etc, but not all debtors are thieves by design!)

Hannah's point about the right time to start pushing financial awareness is spot on. Now that none of can afford to sell our homes and we have flogged off all of our tat from the attic, it's absolutely the right time to start educating people about finances, especially with the rise in VAT around the corner and today's announcement of no tax cuts for 5 years. Everyone needs to tighten their belt and become a bit more financially astute, this is exactly what Martin's been saying for years. I'm astounded by what I have learned on this board in 5 months, and I'm no genius, I just knew that somewhere I'd gone wrong and I needed to put things right. And I found out about this board in the "News of the World" (Oh, the shame!) as I'm sure many others did. This site is just one part of a growing movement in the UK, I think that consumers are becoming more aware of the implications of their spending and they need much more information on how to protect themselves and their money. There are always going to be people who just cannot control their spending, just as there are those who drink too much, eat too much and smoke too much but the majority of us are just uneducated, rather than irresponsible, in financial matters. And a lot of us are willing to learn!

DarkConvict

When it comes to a matter of survival I agree people do what they do to get by, be it payday loans or crime. Crime and recession have always been linked. I think that the real place they need support from in these situations is the government, wish sadly are generally very slow at doing anything other than saying "no".

I have had the luxury of not been in the desperate situation, although I can emphasize with them if the problem is not of their own doing. Tax free allowances and benefits are there to help those on lower incomes to get the basic level of living. But some people do it to survive because they have already incurred a stack load of debt and have crippled themselves already with repayments they cannot afford. In which case it turns back to better planning, the problem been the time it takes to teach children it will be at least 10 years before any real affect is seen.

There is no immediate solution.

Monkeyballs

So, to summarise so far...

A - Payday loan companies are probably here to stay but they need to be better regulated.

B - Getting out of debt shouldn't be easy, you learn nothing if it is.

C - The country is in a position where it is crying out for education to be made available in one form or another re. finances, debt management, budgeting, etc...

Have I missed anything? Anyone have anything else?

debtfreegonnabe_2

Hiya, just new to this site and not experienced at all in joining in other posts. What I would like to say is.................It does not matter how well educated you are or what you have been taught. If your back is against the wall and you are desperate you will borrow from anywhere at any cost of repayment.

I am an educated person and hold down a very responsible job. I just do not have the money savvy gene ! ! ! Next month "was" always a life time away for me.

I do agree money lenders should not lend money without knowing more about your financial background but then again,as it as already been said this may force people to go to scary threatened your physical being loan sharks.

I have a £500 pay day loan to pay this month, but as my thread says I have decided to scrimp, sell and hock to see if I can get through without getting another.

If for some very strange reason I had been refused a payday loan. I suppose I would have got through, don't know how but I would not have died.

I do think they need to have there rates capped and if this was done, it could be a way of a quick although expensive way to get you over a blip, if you can repay in full.

Not as in depth reply as others just my little bit

And colleges do lots of free brush up on your English and maths, surely they can put in brush on your finances. It realey only needs to be basics for a lot of people. If advertised I bet the classrooms would be stowed off with people in financial trouble wanting to learn to be money savvy.

DFGB

barbiedoll

Monkeyballs wrote: »

Maybe someone should contact the government to highlight that personal debt is a massive contributor to stress... And that helping to educate the public in all things financial will have a similar impact on reducing the number of stress related ilnesses such as anxiety, depression, heart attacks, etc... In addition this would reduce the number of people turning to their GP and hospitals for help, thus cutting the amount spent by the NHS treating the side effects ;-)

Interesting thought...

Monkeyballs, I absolutely agree. Stress brought on by money worries has got to be hugely expensive for the NHS, people eat rubbish and drink too much whilst under stress, plus the bill for anti-depressants alone is enormous. As Hannah said, the public campaign for healthy eating has become part of the collective consiousness, this, coupled with the anti-smoking laws, has led to the NHS seeing a large decline in the number of heart attacks and related illnesses in the past couple of years. A similar campaign to highlight the need for financial awareness and to let debtors know that help is available, has got to be worth the cost and effort.

debtfreegonnabe_2

Monkeyballs wrote: »

So, to summarise so far...

A - Payday loan companies are probably here to stay but they need to be better regulated.

B - Getting out of debt shouldn't be easy, you learn nothing if it is.

C - The country is in a position where it is crying out for education to be made available in one form or another re. finances, debt management, budgeting, etc...

Have I missed anything? Anyone have anything else?

yes i agree with this..........posted before I saw this post


DFGB