BBC Radio 4 – Today Programme

Just four minutes, is all it takes to listen to Faisel Rahmen of Fair Finance  on Today’s (17th February 2010) , BBC Radio 4 – Today set the time slider to 0:53.45 and listen to 0:57.11, speaking about the Better Banking campaign, .

This campaign is so important, people lives are ruin by debt, the figures quoted, 2 million without bank accounts, another 5 million with accounts like the Post Office Card Account which does not allow use as a debit card, standing orders or direct debits, this excludes people from getting cheaper products via the net, benefiting from cheaper tariffs, paperless billing, and forces them to pay surcharges for not paying by direct debit.

I cannot support Better Banking, without acknowledging the fantastic work that SAFE Services Against Financial Exclusion at Toynbee Hall have done,  the fact that between 4m and 5m people are borrowing money above 600% APR, and a 1m at over 2500% APR.

Lets hope that this campaign gets results.


4 Responses to “BBC Radio 4 – Today Programme”

  1. 1 John Dunnet February 22, 2010 at 20:21

    I think it is time to start another mutual, Kirby Union. People lending small amounts of money to people by people for the people. If Betfair can link ‘punter to punter’, but in fact price a pool of money….

    The only challenge would be how to get the money into the e-system since the financially disenfranchised do not have the e-means.

    Barriers to entry. e-; FSA regs; trust; anti-money laundering.
    Answers Don’t know; fill in the forms; small amounts only say max £100 month. No large scale laundering??

    • 2 csljohnkirby February 22, 2010 at 20:39

      Tonight on Channel Four, Dispatches: Kids Don’t Count, show how poor maths is in the UK. Banks capitilise on this lack of knowledge. I have taught a moneysense program to around 600 adults, since 2003 and around 80% at the start failed to be able to work out if they had £10.00 in the bank, and wrote a cheque for £6.23, what the balance would be, and 60% thought if they wrote a second cheque for £4.99, that would not bounce because of lack of funds. 25% truly argued the point that a cheque for £4 and one for £6 went into £10, the pence meant nothing to them.

      • 3 John Dunnet February 22, 2010 at 23:10

        I have an almost six year old so watched it too. To be able to not be ripped off/manage, you must be able to have the skills to defend yourself. Then whether you are street wise enough/greed averse to use those skills is another set of life experiences skills altogether. Perhaps ‘avoid the con’ for 7+ year olds should go on the curriculum too?

        Not being able to sell a poor credit offering (not illegitimate sharks now but legit ones) needs two things 1. maths enough for the recipient to figure out they can’t pay; 2. Enough self belief to not say ‘oh to hell with it’. The second is as important as the first.

        Perhaps going bust early with not a lot to lose should also be on the curriculum.

        Worst of all, was having a conversation with CFO of a major multi-national who told me that my team pay-rise pot was 3%, when pointed out the net to the family of a 20k help desk bod was an extra drink for two in the pub once a month said ‘Oh? I never thought of it like that’….

      • 4 csljohnkirby February 23, 2010 at 01:12

        This is what happens with someone with good math skills… This is from an email I sent last week.

        One household I visited, the guy was on a website, I had not seen before called www.(deleted), where he was borrowing £16 for one day, the interest and fees were £5.71 so repayment tomorrow was £21.71.

        This website very clearly states a Typical APR of 2689%. I was shocked, but actually for this situation, strangely (if unfairly) it works, and saves the household a small fortune, and the chap applying was happy.

        He has had a direct debit hit his bank account today for £22.23, which is currently showing today at -£15.43, however this DD will be rejected for returning the account to £6.80, but then a £38 charge will be levied for a failed Direct Debit, causing it to be -£31.20 and then another £38 charge for an unauthorised overdraft at the end of the month. The insurance company for whom the £22.23 payment is for, will levy a £25 charge for the letter telling him the DD has failed and a £10 charge for the failed DD itself. (Total cost £111.00 plus a few pence interest overall)

        Tomorrow, When his benefits payment of £97.00 go into the bank, without borrowing the money from (Deleted), his balance will be £65.80, his life insurance will not be paid (so he will still owe £22.23) and he will still owe in charges £73.00

        By borrowing from (Deleted), his balance will be £75.86, but his DD will be paid, and he will be facing no additional charges, and like he said he will have no black mark against his payment record.

        Another problem faced by those financial excluded, again taken from an email I sent two weeks ago..

        Fairness in banking is important to us all, the financial exclusion that is happening now is an awful form of discrimination.

        One chap was on benefit with a Post Office Card Account, after 3 years of unemployment, he got offered a job, unable to open an account for his wages, he asked the company could they pay the money into his sister’s account. The offer for the job was withdrawn.

        The company when questioned gave the following reasons why they were not prepared to continue with their offer to him.

        1) They were worried that it “could” lead to a situation, where it looked like they were either money laundering, help someone to evade tax\gain benefits (i.e. someone could claim benefits, showing their bank account statement that they had no income)
        2) They could be involve in a third party despite if the money was not paid over to the individual
        3) Whilst the company does not check creditworthiness, there is cash handling involved, so they were minded to withdraw the offer.

        The first two do show some merit, but being poor does not mean people are dishonest, in fact one could argue that in fact one might not be poor if they were willing to be dishonest.

        Both these cases show how inportant it is we get financial education right.

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