Saturday, 23 January 2010

Big up my Little(woods)voice

@LittlewoodsDeal tweeted me today, saying that if I called their service team I could stop the type of call that offers me extended payment at 29.9% APR over three years. Actually I'm quite impressed they had the wherewithal to reply (I had tweeted as well as blogged my dissatisfaction).

The thing is though, I personally don't want to stop receiving calls like this because they keep my fingers firmly on the pulse of sub-prime lending. What interests me most is not stopping calls to me as an individual, so much as stopping this type of call altogether. It's an issue I've considered before, on audioboo - citing the "institutional benefit fraud" of energy companies making a mint from those who pay cash, cheque or worse still, by meter.

You see, I don't agree at all that folk on low incomes have no lending alternatives - saving with a Credit Union strikes me as an inordinately superior method for securing access to emergency funds should you need it - especially when doorstep lenders and loan sharks can look so incredibly similar to a mum rushed off her feet and worn down by the poverty trap. I want none of these extended payments, pay day loans, cash any cheque, pay for view and cash for gold millarkey - they're rot.

The question I most want us, as a nation, to ask ourselves is less which individual is scrounging off the welfare state, but which organisations are preying on such folk with products capable only of perpetuating their misery? How much of the £53 million pre-tax profits made by Provident in the first half of 2009 is accounted for by tax payers' money? How much does Littlewoods make from targeting customers after Christmas? Or Brighthouse? Or Yes Car, oops, ACF car credit?

Let's face it, we only endure the inflated prices of such schemes when we cannot afford to pay in full up front (precisely what I did shopping online, post unemployment over the Summer). And I don't mind a certain degree of inflation - I know full well that the 20 and 38 weeks models include a premium for paying piecemeal (I had a discount voucher I'd been saving to that end, enabling me to even things out btw). However, the cynicism of a marketing strategy, which involves selling yet more credit to those who have already bought on some form of deferred payment so as to brave a downturn, in the week or so before the end of January leaves me seething.

We need a shift in culture. Credit is what has got us into this mess - and no, I don't believe the Crunch has gone away - therefore selling more of the blasted stuff is unlikely to bring us out of it. Somewhere along the line, we have to realise that in a country where 50% of us own 7% of all private wealth, credit will be the straw which breaks the camel's back.  
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