Even if we paternalistically shake our heads at the interest rates and the way these companies do business... they are giving people an option that did not exist before. Those people are strictly better off for the existence of that option, since they are free to turn it down.
And yet I’m not at all surprised to see it.
Wellll, we still have payday loans and the like so I wouldn't really put too much stock in the financial literacy of the developed world.
I guess I don't recall taking the position that predatory loans was an exclusively developing world thing, but if something I said gave that impression, it's on me to be more precise with how things are phrased next time.
Comparatively speaking, more people in comparatively more developed economies tend to have more resources available to them to make informed financial decisions as individuals. I call this financial literacy.
The comment previously made was not intended to suggest these more developed economies are uniquely affected or affected somehow differently than say, for example, African nations (like the one in the article) are from predatory lending programmes.
In 1980, congress passed a law that neutered state usury laws, and prompted banks to change their charters and re-domicile in places like Delaware, South Dakota and Utah, especially for credit cards. The supreme court further weakened state regulatory authority in the 90s by defining fees as interest, and thus outside of the scope of state authority.
By this logic would should allow heroin to be sold at 7-11's
This would at least eliminate many overdoses due to incredibly varying strength or contaminations, especially fentanyl.
Not if they lack the knowledge to make an informed decision regarding what is in their best interests.
(And let's not forget that they're individuals up against an industry that is happy to spend vast sums of money manipulating people's desires and perceptions, in order to grow -- or create -- its "market".)
Usury Laws and such came about because it is straight up bad to have people fall into these debt cycles.
It's just a bad option.
The impact of having folks in a debt cycle is obviously bad.
People in a debit cycle don't only impact themselves.
Like I said Usury Laws exist for reasons.
There are plenty of "voluntary transactions" that society has found necessary to either ban or at least regulate. High-interest loans are regulated in many countries, precisely because they can be predatory, but so are things like drugs. Even legal drugs are pretty heavily regulated for many reasons, including making sure consumers are aware of both the benefit and harm/side-effects that can occur.