When many read these lines, they will think that perhaps someone speaking today, in the XXI century, of a loan shark, cannot contribute much. Indeed, talking about loan sharks will make you feel about past stages in the history of humanity, typical of years almost forgotten.
But sadly, I have to tell you no. Loan sharks are still in force and, more dramatic, normalized in some banking products that many of those people who will think that these lines do not go with them have in their portfolios. Loan Shark, lack of transparency, harassment?? Yes, all of this continues to live with us and does so under the name of a revolving card.
Fast food financing products that, under their great attraction of quick, simple, and with hardly any paperwork, continue to lead thousands of Spaniards each year to situations of real economic distress.
It is estimated that more than two million Spaniards today have a revolving card. In fact, according to the Bank of Spain, up to 14,000 million euros move in this country through this type of financial product. It was facing an economic downturn, renovating the house, or, why not, being able to travel on vacation made them opt for this type of financing, which, as the Bank of Spain itself explains, is a loan that is constantly renewed.
“The amounts of the fees that the cardholder pays periodically become part of the customer’s available credit (hence its name, revolving), so it constitutes a credit that is automatically renewed at its monthly expiration, in such a way that it is a revolving loan comparable to a permanent line of credit, and the agreed interest rate is applied to the capital drawn down,” says the entity.
Some interests exceed, in most cases, the average price of money. Something that has made the Usury Law of 1908 more contemporary than ever in our days. Applying said Law, the Justice is today, in the middle of the year 2021, classifying as users the interest involved in thousands of revolving card contracts and, with it, declaring them null. Interest that the bank, in response to the avalanche of claims that it has to face, has been progressively lowering to avoid new conflicts. Little by little, financial entities have been launched to reduce the interests of this financial formula. To measure that, however, is not enough.
And it is that to the abusive interests supposedly “agreed” with the client, the lack of transparency is added, companion of a trip in practically all the revolving cards. Contracts are drafted in such a complex way that it is not possible to understand the conditions that will regulate them; clauses in letters so small that they cannot be read without the help of a magnifying glass, as some sentences have collected; no information about the loan amortization plan? Together with the loan sharks’ interests, every one of these practices has made more and more people decide to claim and put an end to the nightmare that a revolving card has brought them. According to the Bank of Spain, this explains how revolving card claims have increased by 800% in the last two years.
- In short, a financial trap that, unfortunately, many carry in their wallets even without being aware of it. An example of loan sharks, perhaps the oldest practice in the world, which is still present in thousands of homes, in the sophisticated financial world of the 21st century.
