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Financial services for poor people - Input Junkie

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March 17th, 2015
01:58 pm

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Financial services for poor people
I've been wondering for a long time whether it wouldn't make sense for a non-profit to get into offering payday loans and such, and behold, one exists!.

I found out about them here. They didn't start with payday loans, they started with microloans to start businesses, but it became clear that there was at least as great a need for loans for just plain living.

Link thanks to asakiyume.

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From:asakiyume
Date:March 17th, 2015 06:08 pm (UTC)
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Thanks for helping spread the word!
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From:sturgeonslawyer
Date:March 17th, 2015 06:32 pm (UTC)
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I didn't know about that, but here's another: VITA/TCE is an organization with which I volunteer. We prepare income taxes for low income (this year the cap is ~$53K) and elderly families/individuals for free. I honestly think we do a better job than some of the pay places, too.
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From:drplokta
Date:March 17th, 2015 07:08 pm (UTC)
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The Church of England was talking last year about setting up a credit union to offer payday loans. Not much has been heard about it recently, and I suspect they've quietly ditched the idea upon discovering that nearly all of those outrageous interest rates goes to covering defaults and administrative costs, and not much at all is profit, so they would in fact have to charge outrageous interest rates themselves to avoid running at a loss.
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From:en_ki
Date:March 18th, 2015 05:42 pm (UTC)
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Well, the nice thing about being a charity is that running at a loss isn't a problem per se. But it is definitely questionable whether lending people money when they ask for it and letting them default is a better strategy than just giving money to {needy people, everyone, people selected at random}.
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