For the record, and I perhaps I didn't make this as clear as I should right at the start, my own feelings are not 100% either way at the moment tbh.
My "fair play" point was aimed at SWFC in that they have been approached and, presumably, made a decision that the brand doesn't sit comfortably with them rather than snatch their hand off. It doesn't mean to say that it would be the right decision in every case for every club, including our own.
My own views about payday lenders are that they are (generally) fulfilling a need that would otherwise be met by unlicenced lenders and, having done some work with the national Illegal Money Lending Team, that is never going to end well. On the other hand you hear about some of the stunts some of them pull and I can easily see why some posters are very much against them.
Grapevine - I think the example given was for one week - but if the interest is componded (1.075 to the power of 52) then the bill outstanding at the end of the year would be in excess of £4000! Perhaps those who think this is ok might wish to consider why in Canada the criminal code limits the annual rate to 60% (including fees)? Why is this good enough for Canada (and also much of the US) but ok in the UK. The UK financial regulators are meant to have a role in consumer protection - whay are they being so negligent in letting this happen.
Do not tell me someone actually buys the nonsense spouted by the payday loan industry. The introduction of the publication of the annual percentage rate for lenders was a benchmark set precisely to inform the consumer of the nature of the fees they were paying. The APR rate applies to the debt whether the rate is for a year or for a day. That you are not paying the rate for a year makes absolutely no difference.
The one day example is ludicrous - how many people are going to borrow for 1 day. The most likely scenario is up to 30days - 30 days at 7.25 a day incurs interest over twice the amount you borrowed in the first place!! in just 1 month.
Just had a look at Wonga. If you borrow 500 for 30 days, you pay back 655. Ok it's not exactly a cheap loan but it's nowhere near to being "twice the amount you borrowed in the first place"
Do not tell me someone actually buys the nonsense spouted by the payday loan industry. The introduction of the publication of the annual percentage rate for lenders was a benchmark set precisely to inform the consumer of the nature of the fees they were paying. The APR rate applies to the debt whether the rate is for a year or for a day. That you are not paying the rate for a year makes absolutely no difference.
The one day example is ludicrous - how many people are going to borrow for 1 day. The most likely scenario is up to 30days - 30 days at 7.25 a day incurs interest over twice the amount you borrowed in the first place!! in just 1 month.
It is akin to legalised theft from desperate people. Implicit to any "bank" lending proposition is the underlying duty of care of the lender to establish the ability of the borrower to repay the debt and associated fees. Not only do the majority of such companies not fulfil such duty they exploit it by repeatedly rolling up such loans, over and over again meaning the consumer is paying extortionate rates on the extortionate interest they were charged in the first place.
It is the same abdication displayed by modern day bankers in creating securitized debt obligations using the sub prime mortgage market which spawned specimens like "Ameriquest" (they happily sponsored sundry baseball stadia) which wrought financial desperation on so many.
Society has a raft of consumer law to protect its citizenry from abuse, misrepresentation and exploitation. Why anyone should think Payday Loans Companies should be exempt from such control is beyond me. In most countries they are strictly governed. It is perhaps indicative of the changing nature of UK society people are now so apathetic to such exploitation and why current government legislative programmes need to include 60 new consumer protection laws.
That the payday loan industry has been able to emerge from the shadows in which it used to fester is yet another testimony to the litany of the failures of traditional banking industry to the UK society it used to serve.
It is a matter of personal integrity whether you would wish your name linked to such brands. I salute Sheffield Wednesday.
Grapevine 49
Well said. And, on top of all that, who wants to support a team wearing shirts displaying such a cheap and slimy image ? If this was the price of signing a 20 goal striker and getting into the Premier League, give me the Championship any day
The UK financial regulators are meant to have a role in consumer protection - whay are they being so negligent in letting this happen.
In answer to your last point, I think they are doing the best they can in the current political environment, where the OFT is shedding staff and functions at an alarming rate and all regulators are being given a very definite message from central government to go easy on businesses...
You can find moral fault with literally any big company these days. Have a look around your house and I'm sure you can find some items made by companies whose actions are far worse than a payday loan company.
The APR rate applies to the debt whether the rate is for a year or for a day. That you are not paying the rate for a year makes absolutely no difference.
I give up. Quoting a rate that you're not actually paying makes no difference? Whatever! It's all the nasty loan companies fault and never the responsibility of the person taking out the loan.
I'm off to the club superstore because Nike is a wonderful, benevolent company that does no wrong and I can buy a shirt with a clean conscience.
Didn't Blackburn have the 'Princes Trust' on their shirt last year? And people think they are one of the worst clubs around right now when it comes to 'morals'!
All credit to Wednesday. Perhaps the politicians could follow suit by setting a maximum on the interest rate that these parasites can charge? Can an APR in excess of 100% ever be morally justified?
Do you know what APR means?
Clearly not.
Here's an example for the likes of sm. I jsut went to Wonga's website and used their calculator to work out a £100 loan for 1 week.
Do you know how much interest I would pay? £7.25.
Do you know what the APR is? 4214%
APR is a ridiculous thing to measure on a loan that typically lasts for days.
You are not wrong. However, the likely effect on someone that has to borrow £100 for a week is that they don't have the £7.50 spare, thus at the end of the month (or fortnight if you are talking about people on benefits) they need to borrow the £107.50 for another week (or two).
The payday loan company have no interest in telling their 'customers' that they should borrow £100 for a year and pay £20 interest (rough guess) and manage the payments over twelve months at £10 a month.
Thus the APR becomes a lot more relevant than you, initially, think.
They advertise on the tele with the same logic - we get you out for a jam for £7.50. In the end it becomes a lot more than that - and they know it at the outset.
Please remember that we are not, really, talking about people financing a night out just before payday, nor are we talking about using next month's salary for holiday spending money at a cost of £20 or so. We are talking about getting vulnerable people hooked on borrowing, at a very high rate, to repay last week's loan with a new one. As has been said £7.50 a week equates to £390 a year to borrow £100. Once someone without enough money gets to that point they will never be able to clear the loan.
Legal or not I would not like to be associated with this industry.
Blimey we do have some precious ones among our support. Like Croydon says, you can find offence and generate outrage at anything if you really want to.
It is not as if you are buying the shirt for the sponsor itself. You're buying the shirt through the fact that you love your club and it generates money for them. Does anyone really reckon that not buying the shirt is really going to hurt that sponsor without hurting our own club at the same time?
All this talk about APRs and percentages and all this other bollocks - ITS A FOOTBALL SHIRT WITH A SPONSOR WE DON'T EVEN HAVE, for crying out loud!
What are people's moral views on these potential sponsors:
a porn site a politically biased media company a retailer with a large low cost Asian manufacturing supply chain a transport company or airline with massive CO2 issues a traditional (carbon based) energy provider
People will always object but once and once and once and once again you don't have to use any of the above companies so can take the high-ground that way if you wish.
Now if a slimey, money grabbing, over paid, never needed, under qualified, worse than useless recruitment firm were to sponsor our shirts I imagine most people would lose it all together.
I'm not sure if this was a serious question but my answer would be no to the porn site but yet to the rest.
Maybe my priorities are wrong, maybe my involvement in Financial services makes me a little more reluctant with the loan companies.
You can find moral fault with literally any big company these days. Have a look around your house and I'm sure you can find some items made by companies whose actions are far worse than a payday loan company.
Yes you can - it is a question of degree everyone has to draw their own moral line somewhere however. However, if you believe that football clubs are different from ordinary limited companies and have more of a responsibility to the community from which they draw their support (and this is one of the reasons which makes Charlton so special) then they should make some reference to what they believe to be the general ethical stance of their supporters. My guess is that the vast majority of Chartlon fans have no significant problems with Nike - I very much doubt that they see pay day loan companies in the same light. Similarly I would not expect a self professed family club such as Charlton to be sponsored by a porn company.
What are people's moral views on these potential sponsors:
a porn site a politically biased media company a retailer with a large low cost Asian manufacturing supply chain a transport company or airline with massive CO2 issues a traditional (carbon based) energy provider
People will always object but once and once and once and once again you don't have to use any of the above companies so can take the high-ground that way if you wish.
Now if a slimey, money grabbing, over paid, never needed, under qualified, worse than useless recruitment firm were to sponsor our shirts I imagine most people would lose it all together.
I'm going to write to Richard Branson and ask him to consider sponsoring Charlton. I think it would be amusing and morally correct to have our team and supporters going about with the legend 'Virgin' on their shirts!
So would you buy your mate a drink if he lent you £100 for a week. Say an extra £4 on the 'loan'
What is the APR for that little transaction?
But that isn't what the pay day loan companies try to make you do - they want to encourage you to take out another loan at the end of each loan to repay the previous loan - so that after a year you still owe them £100 pounds plus over a 1000 pints of beer - the deal is more on the lines of I'll give you a£100 and then you keep me in beer for life!
So would you buy your mate a drink if he lent you £100 for a week. Say an extra £4 on the 'loan'
What is the APR for that little transaction?
But that isn't what the pay day loan companies try to make you do - they want to encourage you to take out another loan at the end of each loan to repay the previous loan - so that after a year you still owe them £100 pounds plus over a 1000 pints of beer - the deal is more on the lines of I'll give you a£100 and then you keep me in beer for life!
So either don't take the £100 in the first place or, if you do, pay it back, plus the beer, at the end of the week. Still not seeing which part of this is the fault of the lender rather than the person borrowing.
So would you buy your mate a drink if he lent you £100 for a week. Say an extra £4 on the 'loan'
What is the APR for that little transaction?
But that isn't what the pay day loan companies try to make you do - they want to encourage you to take out another loan at the end of each loan to repay the previous loan - so that after a year you still owe them £100 pounds plus over a 1000 pints of beer - the deal is more on the lines of I'll give you a£100 and then you keep me in beer for life!
where are they encouraging you to take another loan to pay off the first loan?
Some people don't have the option of just taking out one loan. If you've borrowed money from a pay day lender your finances are probably not too good. When they've paid off the first loan, a lot of people need to borrow again just to keep their heads above water. When you've paid back a few times, the lenders up their credit limit and then most people are hooked and can't get out of a spiral of debt.
Rizzo...you're right, it isn't the "fault" of the lender. These lenders do however market themselves to a sizeable population who are unable to easily gain credit elsewhere and a percentage of those will fall into the cycle of debt which sees subsequent loans taken out to repay the one before, all the time adding to the amounts to be repaid.
You're right as well...no-one "forces" individuals to use them. The issue is that some have no choice. Not those borrowing for little luxuries, but those borrowing to live from one day/week to the next and seeing no other options.
These guys, in essence, are simply old-fashioned tally-men for the modern digital age.
They're doing nothing wrong legally, but I would certainly like to see tougher regulation to this sector to give all consumers more protection and limit the amounts they are able to charge as the Canadians do.
The APR rate applies to the debt whether the rate is for a year or for a day. That you are not paying the rate for a year makes absolutely no difference.
I give up. Quoting a rate that you're not actually paying makes no difference? Whatever! It's all the nasty loan companies fault and never the responsibility of the person taking out the loan.
I'm off to the club superstore because Nike is a wonderful, benevolent company that does no wrong and I can buy a shirt with a clean conscience.
Well, Rizzo, what would you suggest should be the quoted rate for fair comparison proposes? There does have to be one and APR is as good as and probably better than most other options. It gives consumers a base point from which to make informed decisions, like is it going to be cheaper getting a loan from Wonga or shall I hit the credit card balance again? I'll be interested to see what you think. It's not really any different from the mpg or 0-62 mph figures quoted by car manufacturers. In the real world you are not going to get either the quoted fuel economy or the 4.1 sec figure (at least without burning out your clutch) but at least consumers know what the different models are capable of given a level road. BTW, I would much rather support a club that did not take the 30 pieces of silver from an odious pay-day loan shark.
The APR rate applies to the debt whether the rate is for a year or for a day. That you are not paying the rate for a year makes absolutely no difference.
I give up. Quoting a rate that you're not actually paying makes no difference? Whatever! It's all the nasty loan companies fault and never the responsibility of the person taking out the loan.
I'm off to the club superstore because Nike is a wonderful, benevolent company that does no wrong and I can buy a shirt with a clean conscience.
Well, Rizzo, what would you suggest should be the quoted rate for fair comparison proposes?
Why does there even need to be a quoted rate when the exact amount you are borrowing and repaying is shown to you in very clear, rather large print? Why not compare the actual amounts? If one company wants you to repay £10 and another wants £9 over the same period isn't that sufficient to give people an idea of which might be better? Plus it's actually relevant, unlike APR. What's the point of comparing APR when it's not what you're paying?
Comments
My "fair play" point was aimed at SWFC in that they have been approached and, presumably, made a decision that the brand doesn't sit comfortably with them rather than snatch their hand off. It doesn't mean to say that it would be the right decision in every case for every club, including our own.
My own views about payday lenders are that they are (generally) fulfilling a need that would otherwise be met by unlicenced lenders and, having done some work with the national Illegal Money Lending Team, that is never going to end well. On the other hand you hear about some of the stunts some of them pull and I can easily see why some posters are very much against them.
If people are so pissed off and geting moral then dont pay a player 30---200K a week when some poor bastard is a steward on £6 pound an hour.
or kick all the low paid staff out the door when the players on the big dosh just got you relegated.
Just had a look at Wonga. If you borrow 500 for 30 days, you pay back 655. Ok it's not exactly a cheap loan but it's nowhere near to being "twice the amount you borrowed in the first place"
Well said. Well said. And, on top of all that, who wants to support a team wearing shirts displaying such a cheap and slimy image ? If this was the price of signing a 20 goal striker and getting into the Premier League, give me the Championship any day
oft.gov.uk/news-and-updates/press/2013/20-13
...but let's not turn this into a political thread please guys.
You heard it here first.
I'm off to the club superstore because Nike is a wonderful, benevolent company that does no wrong and I can buy a shirt with a clean conscience.
The payday loan company have no interest in telling their 'customers' that they should borrow £100 for a year and pay £20 interest (rough guess) and manage the payments over twelve months at £10 a month.
Thus the APR becomes a lot more relevant than you, initially, think.
They advertise on the tele with the same logic - we get you out for a jam for £7.50. In the end it becomes a lot more than that - and they know it at the outset.
Please remember that we are not, really, talking about people financing a night out just before payday, nor are we talking about using next month's salary for holiday spending money at a cost of £20 or so. We are talking about getting vulnerable people hooked on borrowing, at a very high rate, to repay last week's loan with a new one. As has been said £7.50 a week equates to £390 a year to borrow £100. Once someone without enough money gets to that point they will never be able to clear the loan.
Legal or not I would not like to be associated with this industry.
It is not as if you are buying the shirt for the sponsor itself. You're buying the shirt through the fact that you love your club and it generates money for them. Does anyone really reckon that not buying the shirt is really going to hurt that sponsor without hurting our own club at the same time?
All this talk about APRs and percentages and all this other bollocks - ITS A FOOTBALL SHIRT WITH A SPONSOR WE DON'T EVEN HAVE, for crying out loud!
Maybe my priorities are wrong, maybe my involvement in Financial services makes me a little more reluctant with the loan companies.
Say an extra £4 on the 'loan'
What is the APR for that little transaction?
Well said.
You're right as well...no-one "forces" individuals to use them. The issue is that some have no choice. Not those borrowing for little luxuries, but those borrowing to live from one day/week to the next and seeing no other options.
These guys, in essence, are simply old-fashioned tally-men for the modern digital age.
They're doing nothing wrong legally, but I would certainly like to see tougher regulation to this sector to give all consumers more protection and limit the amounts they are able to charge as the Canadians do.
It gives consumers a base point from which to make informed decisions, like is it going to be cheaper getting a loan from Wonga or shall I hit the credit card balance again? I'll be interested to see what you think.
It's not really any different from the mpg or 0-62 mph figures quoted by car manufacturers. In the real world you are not going to get either the quoted fuel economy or the 4.1 sec figure (at least without burning out your clutch) but at least consumers know what the different models are capable of given a level road.
BTW, I would much rather support a club that did not take the 30 pieces of silver from an odious pay-day loan shark.