Shopacheck 440.3% APR???

Michele37

Just got a leaflet through the door about shopacheck vouchers, I have no intention of getting any whatsoever

BUT

it says it is 440.3% interest is this right??? or is this a misprint, says it twice on the leaflet too!!

says get £100.00 in vouchers a pay back £150.00 that is not 440%!!

I am only posting this because I am flabberghasted at the rate of interest

Michele

Michele37

YES it is right!!

Flippin eck!!

There is a big article about it on the bbc website

how can they get away witrh that, justify that are peopel really that daft to get these vouchers?

Scully's_Girl

what is the bbc link?

myrnahaz

It's certainly true - although that would be just the starting interest rate - it escalates each week thanks to some friendly persuasion by the agents. My sister borrowed £100 from these crooks and was quoted a figure of £160 if she paid it off in 3 months, but each week, the collector would call (my nephew called her 'our friend Kate') and, if sister couldn't afford the £5 repayment, lovely old Kate would smile and say 'no problem, I'll just add it on...' she never explained that extra interest would also be added. How diabolical is that? It would have taken her decades to clear the debt if we hadn't stepped in. These companies justify their charges by saying that they take a huge risk in lending to people who have no credit score and so wouldn't be able to borrow from a normal source, such as a bank.

Astaroth

APR is based on borrowing £1000 over 12 months and includes interest and fees. It is natural therefore that any credit product that is either designed for low value/ short timescales or much very large limits (eg "prestige" cards like Natwest Black or Amex Platinum Charge Card - both have annual fees of a few hundred pounds) will get what looks very high interest rates but to be honest it is a little bit skewed.

Being realistic though.... the average cheque cashing service is a loan of £100 for 1 month. If they were to charge a "normal" interest rate of 20% APR then they would get less than £1.50 back on top of the loan from which they would have to pay staffing costs, insurance, licensing, put money a side for bad debtors, building costs, tax etc etc.... no company would be able to make a profit on that and these places wouldnt exist and therefore there are people who would simply not be able to get a short term advance on money.

Door step lenders which myrnahaz mention are the other common ones to come under fire but add to the cheque cashers cost the cost of someone having to come round to your home every week and their operational costs go up even higher.

kuohu

Scully's_Girl wrote:

what is the bbc link?

Seem to be a couple of pages...
Shopacheck on Inside Out

Inside Out

There's probably a whole debate about whether practices like this should be allowed or not. On the one hand I can see that they are filling a need, and if you've got 2 weeks till the next money comes in then you're desperate and have to get some money somewhere. But on the other hand these companies are leeching off the most needy and that just can't be right. Same with Cash Converters and places like that.

I haven't been there, but my opinion rests with the latter of my two statements above.

jinkssick

i hope that when not one single person is in their offices, that theres an electrical malfunction and see the whole place up in smoke.

this hurts my heart. of course people do have the choice but many users have no choice so this smilling-since-farepak-and-thesee-extra-customers-in-xmas-will-bring-capital-for-them.

BFG_2

jinkssick wrote:

i hope that when not one single person is in their offices, that theres an electrical malfunction and see the whole place up in smoke.

are we now really that PC that before we say things like 'I hope that their offices burn down' we have to explain that we would want the offices to be empty (and presumably not during the winter so as not to injure or de-home any hibernating hedgehogs)??

What is the world coming to.............!!!!!!!!!!!!

THE_LONE_RANGER_4

Shopacheck, Provident,and These Car Loan Companies Along With Cash Chequeing Shops I Hate All Of Them It Shouldnt Be Allowed But Is We Managed To Close One Shopacheck Down N Our Town They Moved Over To Telford The Credit Union Had A Lot To Do With That , You Need To Educate People That These Companies Will Keep You In Debt For Years And Must Be Stopped , These Car Adds On Tv Also Wind Me Up The GarAges Sell You Crap Its A Disgrace

BFG_2

People Who Put A Capital Letter At The Satrt Of Each Word Annoy Me....almost As Much As People Who Type In Capitals

BFG_2

People Who Put A Capital Letter At The Start Of Each Word Annoy Me....almost As Much As People Who Type In Capitals