Dont look at the sponsors of the bill "loan shark prevention act"

[biggestal99]

@Snow96

You do know how a pre-paid card works right? How does the consumer get charged 15% when they can only spend as much as they have loaded on the card?

So how do credit card companies make money? a per usage fee?

Allan

[SeaManatee]

I like the military families that don’t get captured in predatory credit schemes.

[Snow96]

You don’t think the credit card companies will do something to make up for the lost mondy the higher rates bring in? Really?

[CanadianJudo]

This bill isn’t really about credit card companies, its more about “Pay-day” money lenders.

[highroller]

They will make money where they can, but they’re not going to magically rate rates for everyone.

If they could, why haven’t they already? They’re in business to make money.

[Snow96]

Then why not cut out the credit card cap and just make it for other loans?

[CanadianJudo]

because your creating a loophole which will be exploited.

[JayJay]

One must first ask “What is the root cause of predatory loans existing?”

Then we can talk about proper solutions to the problem.

[reflechissez]

@Snow96

If that’s the max they can charge, and the article says the average is 21% on credit cards, what do you think is going to happen to make up the difference between and average of 21% and 15%. Look for the lower rate payers to get hit because of it.

You don’t think credit card companies are just going to say “oh well, we’ll just bump all the high cards down to 15% and eat the loss” do you?

You actually think this is what will happen? So, no financial institution will say: “hey, let’s poach our competitors’s credit-worthy clients by offering them lower rates?”

[WorldWatcher]

@JayJay

One must first ask “What is the root cause of predatory loans existing?”

Then we can talk about proper solutions to the problem.

“What is the root cause of predatory loans existing?”

Poverty
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[highroller]

1. The system allows them to exist without consequence.
2. There is no financial education in highschool. (This may be changing)

How is anyone every supposed to get out of the hole with 300% loans? Better to not allow that.

I didn’t even have a credit card until I was 27 and I managed just fine.

[Snow96]

So suddenly all the payday lenders will get hooked up with Visa/mastercard and start issuing credit cards to those people is what you are saying?

[IBC]

15% is still too high. Just sayin’.

Of course, I think the whole credit system needs a massive overhaul, anyway, so…

[WorldWatcher]

@Snow96

So suddenly all the payday lenders will get hooked up with Visa/mastercard and start issuing credit cards to those people is what you are saying?

I would suspect that many would switch to secured loans and be outside the law. When Virginia cracked down a lot on Payday Loans a few years ago, I saw an uptick in business offering “Title Loans”.

Under Virginia law the interest rate is limited to 15% to 22% PER MONTH (that’s right an APR ranging from 180% to 264%.)

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.^^^^

[LucyLou]

Credit card companies charge a transaction fee to merchants.

That’s how they make money off people like me who use credit cards but pay them off every month.

[biggestal99]

@LucyLou

Credit card companies charge a transaction fee to merchants.

That’s how they make money off people like me who use credit cards but pay them off every month.

Thanks for the information. I knew CC made money somehow.

Allan

[LucyLou]

@biggestal99

@LucyLou

Credit card companies charge a transaction fee to merchants.

That’s how they make money off people like me who use credit cards but pay them off every month.

Thanks for the information. I knew CC made money somehow.

Allan

If you remember, a lot of small companies resisted accepting credit cards because they did not want to pay those transaction fees. And sometimes offered a discount for cash. But eventually the tide totally turned and now those fees are just cost of business.

I’ve often thought that despite those fees, it must streamline business and lower costs. Handling cash is time consuming and prone to mistakes.

[Snow96]

@LucyLou

Credit card companies charge a transaction fee to merchants.

And that’s why a bunch of places now no longer take Visa – because of the merchant fee’s.

[reflechissez]

@Snow96

@LucyLou

Credit card companies charge a transaction fee to merchants.

And that’s why a bunch of places now no longer take Visa – because of the merchant fee’s.

They’ve always charged a fee. There are some businesses that won’t take cash anymore. What’s your point?

[Cratic3947]

Then the left will be saying it’s not fair people with poor credit can’t get loans. Because that’s who gets 15% rates. Law of unintended consequences.