What happens if you have the cheek to try and charge people 4000% interest?

[Bunk]

Yes you can - as thats what the APR is for - its to compare the cost of loans.

I used to be a volunteer director of a credit union - we'd charge 11.9% APR no matter what size of loan. For some reason (lack of advertising budget due to not charging extortionate rates) we never manageed to attract anywhere as near as many people as we expected. Actually I know the real reason but could never convince the other directors - the words credit union are off putting - sounds very official and "expensive". If we'd have called it "CheapCash.com" instead of "BlahdiBlah Credit Union" we'd have helped thousands not hundreds. Still...

I'd love to see credit unions getting a much bigger share of the lending pot as most of the people who work for them don't just want to make money, they give up their time and energy to try and teach people how to save and budget so they don't need borrow in future.

What would the APR be on one of those loans if they only wanted, for example, £100 for 5 days? Would it still be 11.9%?

[gingerjedi]

Why doesn't the government operate a similar scheme?

[SimonMac]

Why doesn't the government operate a similar scheme?

Because places like Wonga can stream line their operation to keep overheads to a minimum, the Govt would never be able to run as efficiency.

[BrilloPad]

No wonder this country is fooked.

If people are short of money then do without. A bit of financial planning would help.

[stek]

There was an example on the radio about how misleading APR can be, I forget the figures but it was something like say you borrow £20 off you mate, pay back a week later and reward him with a pint, you've ended up paying something like 2000% APR...

[vetran]

No wonder this country is fooked.

If people are short of money then do without. A bit of financial planning would help.

You earn below the average wage, your car that has been limping along (and fixed up) for years blows up, you can't get to work. You need to borrow £500 to buy another wreck, obviously you need better financial planning.

Your gas bill comes in and its school start do you buy £200 of school mandated clothes so your kid isn't called into the office every day or do you pay for gas to cook the kids dinner?

don't talk tulip. its a different world, its not choosing between going to Turkey or Antigua for holiday. Does my new car have built in GPS or do I buy a stand alone one?