Get the money you need, the way you want it!
With our customer-oriented service, we can lend you the money you need.
You can receive approval as quickly as 24 hours.
I am quoting the Island Finance website. And it is a very tempting text, to a very shaky proposition.
As you know, locals who need access to money, below Awg 5,000, head to Island Finance. Banks usually start talking to you at Awg 5,000 and up. Below? They offer credit cards, but you must be gainfully employed.
Our mission, says Island Finance, is to simplify the process of borrowing for a wide range of consumer purposes by taking the hassle out of getting a loan. Our unique business model for unsecured loans is captured in our tagline: You can rely on us.
Can you believe this inviting text?
I recently got a postcard in my mailbox advertising the services of Island Finance, touting the ease of obtaining up to Awg 30,000 in an unsecured loan. The interest rate was left out. All other conditions of the loan, were also left out.
The interest is usually around 28%, and the monthly payments start at once.
A recent item in the media recounted the story of an Island Finance client who rolled over his debt five times, until he was totally unable to pay it back.
The court reprimanded the lending institution for being too eager to lend, ignoring red flags.
Where am I going with this?
I understand that alternative financial institutions provide necessary services outside the realm of traditional banks, and credit unions/funds. But should they be allowed to advertise the EASE of lending, without any mention of the burden of pay back?
I totally get microfinance institutions that start small businesses going, they are especially important in developing countries, but the loans secured by Island Finance are personal, and mostly UNRELATED to business.
Should they be allowed to promise something they cannot deliver as advertised?
They are targeting underserved, underprivileged demographics, without disclosure of rates, fees such as life insurance, and potential penalties.
Ta tempo pa haci reservacion di bo VIAJE, said the postcard in my mailbox, haci bo prestamo te cu 30.000 y cuminsa paketa bo malets. The graphics on the card depicted suitcases, a ticking clock, and palm trees.
Take out a loan and start travelling, it advertised.
I imagine Island Finance is in full compliance with regulations, but is it right? Are the interest rates fair? Is the payment plan flexible? Do they also teach the client how to manage his/her finances?
