Microlending is not generally my beat, but this email from one of my regular correspodents caught my attention.
More information here, here, and here, if you're interested in the back story.
Check it out:
https://www.ioucentral.ca/iou_status
They aren't facilitating new loans at the moment - right after an article was published in the Globe & Mail reported that one woman had averaged a 14% return with only a 0.05% default rate. A conspiracy theorist would have fun with this one!
More information here, here, and here, if you're interested in the back story.
As I told my correspondent, I think that conspiracy theories are a tool of underachievers with an overdeveloped sense of entitlement to rationalize their own failures according to a complex web of the ways that "The Man" is keeping them down.
This is a case of a company brushing up against a regulatory structure that they weren't fully aware of. It happens all the time. A few years ago, HBC used to offer "balance insurance" on new account signups as well as existing accounts for their credit card: promising payment of your oustanding balance if you were unemployed, injured or dead. As an associate, you got a $5 "commission" for every cardholder you got to agree to check and initial the little box on the credit app. I think it was something like a two dollar a month premium, but it adds up.
This went on for years, until various provincial governments, including Alberta and Quebec caught wind of it, and landed on them like a sack of hammers. If you're selling "insurance" the people selling it need to be licenced and registered, which HBC retail associates most certainly weren't.
IOU Central is an interesting concept, and I don't think they're loansharking, but they certainly should have paid for more due dillegence on Canada's banking laws...
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This is a case of a company brushing up against a regulatory structure that they weren't fully aware of. It happens all the time. A few years ago, HBC used to offer "balance insurance" on new account signups as well as existing accounts for their credit card: promising payment of your oustanding balance if you were unemployed, injured or dead. As an associate, you got a $5 "commission" for every cardholder you got to agree to check and initial the little box on the credit app. I think it was something like a two dollar a month premium, but it adds up.
This went on for years, until various provincial governments, including Alberta and Quebec caught wind of it, and landed on them like a sack of hammers. If you're selling "insurance" the people selling it need to be licenced and registered, which HBC retail associates most certainly weren't.
IOU Central is an interesting concept, and I don't think they're loansharking, but they certainly should have paid for more due dillegence on Canada's banking laws...
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