The Xmas Purchase Solution
October 28, 2008
For the most cash strapped families who will find it hard this Christmas due to the credit crunch, there is a new credit card in town!! The only problem is that it is the most expensive credit card in the UK with an interest rate of 227%. This is being promoted as a solution for those cash strapped families.
The Easy Shop Card, which is linked to Argos, has been condemed by MP’s and debt experts alike as ” wicked ” and is something that they have been warning people to stay away from.
As has been revealed by Argos sales this year compared with last are down 9% so a way of getting those figures back up they believe that the Easy Card will help during this vital period. An example of how the product would work would be is you looked at spending £ 100.00 using this new product. To repay this over a 27 week period would mean the consumer would be paying back interest of £ 35.00 on top of the £ 100.00 which in itself equates to an APR of 227. This new product has been produced in association with Provident Financial.
The Liberal Democrat Shadow Chancellor Vince Cable MP says “A lot of people are finding it increasingly difficult to borrow from the mainstream high street banks.”
“Many may well feel they have to fall back on things like this. There is a real risk of a very large number of people being exploited as a result.”
He continues “In my view it is wicked to be promoting such high interest cards and loans at Christmas, when people feel under pressure.”
He is not the only person to have a similar view on the new product, Louise Bond from uSwitch said “Despite the recession, life does have to go on but we strongly advise people not to be lured into this type of deal.”
“It may seem like a quick fix but will cost you dear in the long run.”
She added “Despite being attached to a well known high street brand, people shouldn’t be fooled into thinking this is anything other than a sub-prime loan.”
And from the other side the company Provident Financial push the product as a simple way to borrow and spend and the product is advertised on their website as “We have teamed up with high street retailer Argos to give you a great way to shop - the Easy Shop card; a plastic card that lets you shop at Argos, without the worry of overspending.”
The word from Argos is “By law, home creditors must advertise their lending rates as an annual percentage rate.”
“Home credit companies have suggested for some time now that APR can be misleading because their loans are repaid over a short time period.”
Provident said “Our charging structure is fundamentally different to that of other lenders.”
“Provident home credit has a single, up-front, fixed charge that customers see from the start, which includes interest on the loan, the cost of the agent’s weekly visit to the customer’s home and the fact that the total amount to repay will never go up - even if payments are missed.”
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I received a letter last week offering this and nearly fainted. There should be a law brought out by Brown and his cronies so that the public is protected from rackets like these. Local money lenders would ask for less interest than this!
Argos should be ashamed of this card! And anyone applying for one should take a good look at themselves.