Usury

This blog is not given to pronouncing on policy or public affairs. But yesterday I saw something that made my blood pressure rise.

I’m afraid you can’t really see it in this picture (cameraphone across the street), but the advertised interest rate is 8% per week.

If you borrow one dollar at 8% per week, and don’t pay it all year, you will owe $59 by the end of the year. Which is to say this is about 6000% pa.

This is loan sharking, plain and simple, calculated to wipe out the very little resources of our most vulnerable citizens.

Whether this operation’s clientele is genuinely desperate or simply acutely ignorant about money hardly matters—if there are enough customers around to sustain this business, our society has failed.

As an aside, I’m pretty sure it’s illegal to advertise an interest rate in anything other than annual terms. Next time I’m in the area I’m going to gather enough details to complain to the appropriate authorities.

Update: Jack points out in comments that this is a pawn operation, which in many respects makes it rather better. See below.