Easy Credit

September 12, 2019

Easy credit keeps me employed.  I have been working in the insolvency industry for about 25 years and if credit weren’t easy to come by, I would be out of a job.  On the way into work I listened to an advertisement on the radio from a company that advertises easy credit.  The ad was very convincing, it almost had me (cynic that I am) sold, “money for braces” for the kids, “money for vacation” and other somewhat glamorous or desirable purchases.

The reality is the easier the credit the more expensive it is.  Some finance companies advertise “easy credit” for people with “bad credit”, “no credit” or even “bankruptcy”, and charge up to 59% interest for their loans.  Payday loan companies now offer credit cards, and lines of credit in addition to cheque cashing services, all at very high rates of interest.

I recall, as a much younger person, a great motivation for working was getting together with friends for a pint of beer and a game of darts on the weekend.  In fact, when guys were broke and unemployed, the closer they got to the weekend, the more motivated they became to scrape up some money, from somewhere, anywhere!

There are some folks who have irregular employment but still have regular bills and rely on cheque cashing services at payday loan companies.  Partly because banking can be expensive and partly because of bad credit, no overdraft protection is available, and, in some cases, they have kited cheques through ATMs and the banks have closed their accounts.  But many of the people using payday advances are just simply poor and each month they slip further and further into “easy credit”.

Given that more than half of all Canadians struggle to meet their basic needs, on their income alone, it should be no surprise that the “easy credit” companies are able to thrive.

I love listening to easy credit advertisements because, although it should be avoided at all costs, it sounds so attractive, the notion of having access to money, especially when you are broke, has tremendous appeal.  If only selling insolvency services – helping people to get out of debt and stay on track with a proper budget – were so easy, what we do isn’t sexy but it sure can improve lives.