The NEW Provident Visa Card

CannyJock

Tirian wrote: »

Provident are one of the biggest lenders in the country!

Not going to bash the Provident here. But if you seriously expect people on this forum to sing their praises for charging crazy high rates then you're probably not going to get much luck.

Part of the harsh reality is that people dependent on companies like Provident and who buy things from catalogues for the "easy weekly payments" can find it difficult to get out of that situation because they're always in debt to these people.

Half my family are in this situation so I'm not talking from some ivory tower.

Tirian

I'm not saying that they are necessarily angels with hearts of gold, but neither are they some kind of boogeyman. And asking if the FSA know about them is laughable.

And they're certainly not any worse than the big banks and credit card providers. Let's bear in mind a few things before we get all creditworthier-than-thou:

1) Provi don't force anyone to borrow from them. Everyone makes a choice if they want to borrow or not - whether it's at 0% APR or at 186%.
2) If they didn't exist, the alternative would be loan sharks and unlicensed lending - back to a Dickensian society. If organised crime is running the show, then it certainly won't be FSA regulated - and believe me, you would know the difference!
3) The Provi don't lend large amounts, so the amount of trouble you can get into is limited.

I'm not saying nobody gets into difficulty borrowing from them, but I do a lot of work for a debt advice charity, and I can tell you right now that we don't see many people going bankrupt because of the Provi. We do see a lot of people going bankrupt because they got a few credit cards, and borrowed everything that the bank would give them.

Your 'harsh reality' applies as much to all those middle-class aspirants with their credit cards permanently maxed out, and permanently knocking against their overdraft limits as to people who borrow a bit of cash from the Provi.

inmypocketnottheirs

Tirian, my post #6 is made in irony.

The points you make are 100% spot on.

It always makes me chuckle when someone starts a Provident/Vanquis/How Dare They Thread as these always degenerate into the creaditworthier than thou type posts to which you refer.

Of course, in an ideal world, anyone with a modicum of sense would stay away from Provident, but in the real world they provide a lifeline to many on low incomes. The real problem is the way the finance industry is forced to illustrate the cost of borrowing by using APR's.

Dylanwing

Part of the harsh reality is that people dependent on companies like Provident and who buy things from catalogues for the "easy weekly payments" can find it difficult to get out of that situation because they're always in debt to these people.

And if you look through the Forum you will also find a lot of people permanently in debt to so-called reputable lenders.

Martinslovechild

inmypocketnottheirs wrote: »

The real problem is the way the finance industry is forced to illustrate the cost of borrowing by using APR's.

That's not a problem. It's called transparency.

JF77

Interesting thread. I grew up in the knowledge of what my mum referred to as Provi cheque's. She would get dead excited about receiving them as it meant we could all have a better christmas and yes, I believe it was the weekly amount that she would pay back that interested her most being a single parent on low income and not the total amount payable. Having no bank account meant this was really her only option and without it she would have struggled. Oh and I only remember having to hide behind the sofa a couple of times when the provi man knocked at the door lol!

JF77

Also, good point by Tirian that they don't lend out large amounts so no getting into mega trouble.

CannyJock

Agree with you that the banks aren't angels - have been helping a few people who have been totally stitched up by their banks.

Best one so far is one person who has signed up for an expensive mortgage, maxing out on an unsecured loan of 25K at 20% APR over 8 years when they only needed to borrow 20K, offered credit card at 29.9% APR and only paying the minimums, signed up for buildings & contents insurance, payment protection insurance for people not on the mortgage.

Not saying that the Provident are better than the banks, they're just differently bad. Different customer base, different practices, but you still put money into their pockets.

The problem in both cases is that the people are in need of the money and are amazingly "relieved" when they get approved.

I know lots of people with huge amounts of common sense, but absolutely no common sense when it comes to money because they've never been taught how the system works. That's why I like to recommend that people watch Martin's YouTube clips - help them understand that practically every company is out to sell you stuff - and help them learn how to make their money work for them no matter their individual incomes.

gilligansyle

People who use Provi don't usually have a choice and like the fact that they know EXACTLY how much they are paying each week. That doesn't make them bad people, just need a bit of help. They probably don't get into arrears as they get to know their agent and have to personally tell the agent they haven't got the money.
My credit card, in theory has 16.9% APR, but if I paid the £2000 back at the same rate as I woould pay £2000 to Provident, I dread to think how long it would take to pay it back!

If you were to look on DFW at the Bankruptcy thread, most of the posters on there owe money to normal banks, and got hit by them. No lender is perfect, especially once you get into trouble with them.

It's horses for courses really. You can look on the Mortgage Board and find posts about 'why did you go to sub-prime lender?', people with a good credit rating have choices, those without go where they can.

Tirian

CannyJock wrote: »

Agree with you that the banks aren't angels - have been helping a few people who have been totally stitched up by their banks.

Best one so far is one person who has signed up for an expensive mortgage, maxing out on an unsecured loan of 25K at 20% APR over 8 years when they only needed to borrow 20K, offered credit card at 29.9% APR and only paying the minimums, signed up for buildings & contents insurance, payment protection insurance for people not on the mortgage.

Hehe, I think I can beat that. Last year we had a couple who owed £500,000 in total - and over £400,000 of it on credit cards. I thought that was the craziest one we would see for a while. However even that has been completely eclipsed already this year by a recent case, but I can't really go into any further details. Suffice to say it would make your toes curl!!