MSE News: Church in bid to 'compete' Wonga out of existence

dastep

I think the bible is clear about what exactly Christians are supposed to be doing in the world. In John 18:36, Jesus makes it clear that this earthly world system is not His. 'My kingdom is not of this world'.

Paul writes in 1 Corinthians 2:2 "For I determined to know nothing among you except Jesus Christ, and Him crucified."

On the subject of paying taxes, Jesus said: "Render therefore unto Caesar the things which are Caesar's; and unto God the things that are God's.

Yes, Wonga's rates are terrible, but what on earth does this have to do with Christians? This is a political matter and the government needs to deal with it accordingly.

The ABC should focus his business on obeying what Paul said and preach Jesus Christ crucified and nothing else, and leave the messy matters of finance and politics to the politicians and bankers.

ashleyriot

We understand that the high percentage rates that Wonga et al have surround the fixed costs of administering the loan (and factoring in bad debt etc.) so if the Church can use volunteers to complete this via a Credit Union, this cost will drop.

It would not be right for the Church just to give money to people because there are behaviour issues the debtors need to face and deal with but being able to "unfairly" compete (i.e. smaller admin fees) against these Payday Loan companies is rather satisfying.

Also, with my background in Zopa, it is my understanding that companies can write off bad debt against their tax bills - I know certainly the big banks do so I imagine Wonga etc. do as well.

rodgerramjet

I dont agree with the statements that the interest is so high because of the default rates. They dont plan on people not paying they just realised that with banks not lending and people needing money that they could just charge what they want. Plusethey like others place charges on when a default occurs.

I cant say enough about credi unions they are the way to go and they should be promoted more than they are.

I personally believe the interest rate should be capped, but if no one used them then they wouldnt survive, alas that wont happen as people will still get desperate and take their money.

I would like to know what banks have loaned PDL companies money to setup, I think that would make for interesting reading.

OneLife_OneShot

This thread is so funny.

I don't believe in God at all so I won't be having the church tell me who I can and can't lend from. Not that it would be Wonga or a PDL anyway!

The church makes enough money by not paying taxes, until they pay property tax I won't take anything they try to input into anything with any great thought at all. If they want to get into financial stuff then pay taxes first. Do what Italy has done and stop church tax exemption.

JimmyTheWig

rodgerramjet wrote: »

I dont agree with the statements that the interest is so high because of the default rates. They dont plan on people not paying they just realised that with banks not lending and people needing money that they could just charge what they want. Plusethey like others place charges on when a default occurs.

If it was a case of charging what they wanted then new players would come into the market with lower rates, still make a decent profit, sweep up all the customers with their lower rates and be laughing.
Why do you think this isn't happening?

Percy1983

THis is what people don't understand, if I go to the bank and ask for £5k, there is on application and I will only get it if they are confident I will pay in it back, 5 years later they have it all back + interest in most cases.

PDLs, one application and the same time to lend £100, they have a 60% chance of getting it back + interest.

Likewise those who aren't a massive financial risk are more likely to get accepted for a credit card, leaving those who don't (the higher risks) to PDLs.

I really don't see they problem, they offer a service which is upfront about costs, if people choose to accept that service so be it.

iolanthe07

I think you've all misunderstood what is proposed. The Church's involvement will not be direct lending as such, but will be in such things as offering facilities and premises rent free to Credit Unions.

The church makes enough money by not paying taxes, until they pay property tax

The church receives no tax breaks beyond those available to any other charity. If churches had to pay property taxes on their 16,000 church buildings, then of course they would be bankrupt within days. They do pay full council tax on Vicarages.

dealer_wins

Default and not only will we ruin your life, we will also ruin your afterlife!!

antrobus

bylromarha wrote: »

Welby is a cleric, yes, but he has an army of volunteers to work this through at the grassroots level.

Volunteers who give a damn about the poverty some people are living in and would welcome the opportunity to get involved in their lives and help find long term solutions to the short term loan problem by helping out with budgetting and the like.

Can see CAP taking this on as part of their services.

Wonga solve the immediate problem. Welby and gang give a damn about the long term.

Yesss...

This post summarises the problem with credit unions. Too many people see them as some kind of charitable endeavour, which is why there is a regular stream of bankrupt credit unions. A credit union is a business first and foremost, and has to be run as one.

GhIFA wrote: »

...The church is one of the richest establishments in the country. ..

Odd. The latest figures I could find (2010) showed the COE running at a loss.

Percy1983 wrote: »

It is interesting as it is unfair competition if a charity is allowed to make a loss to offer the same service. ..

If they make losses they won't last very long.

adouglasmhor

antrobus wrote: »

There's probably a reason why Errol Damelin is a businessman and Justin Welby is a cleric.:)

Welby was a senior oil executive for years before he felt his calling.