the Government is ready for a showdown with payday loans, because the industry has questionable practices that are to the detriment of the Danish society.
that is How it sounds from the minister of trade Simon Kollerup (S), on Wednesday at 10.45 embarks on negotiations for a showdown with payday loans. It writes Politiken.
– If kviklånsfirmaerne disappeared from Denmark, I would cry dry tears. Payday loans have proven to be an exorbitant way of doing business, which is to the detriment of our desire to have a good society.
payday Loans are putting people, who are already in a vulnerable social situation, in what one can best describe as a debtor’s prison, says Simon Kollerup to Politiken.
According to a memo from the ministry of industry runs the annual percentage of payday loans known as the apr – up to 700-800 percent.
It is a number, as Simon Kollerup call ‘crazy’. The social democrats proposed before the elections, an apr-ceiling of 25 percent, and it is a possibility, as Simon Kollerup has with to the negotiations.
the Left is, rather, the opponent of an apr-ceiling. Forbrugerordfører Torsten Schack Petersen says to Politiken that the apr in some cases can be a difficult size.
For example, if you borrow 3000 dollars for 30 days, as apr is calculated over a whole year.
the trade Association Digital Lenders, representing kviklånsbranchen, is also opposed by an apr-ceiling.
Spokesman Jens-Ole Kyhl Klitgaard writes in an email to Politiken that the Danish Parliament should bear in mind that the biggest part of the consumers ‘ debt problems lies in the larger and longer consumer loans.
Digital Lenders have even suggested that the cost of payday loans must never be greater than the amount you have borrowed.
If you borrow 10,000 dollars, the highest amount, you must pay back, be 20,000 dollars, if you comply with the terms.
at the same time, proposed a maximum penalty of 25 percent on the year, if you do not pay the money back on time.
