Friday, 25 May 2012

The Voice - Consumer's Voice

Dear Consumer’s Voice #1

I would like to ask why micro lenders when you ask for the balance of your loan they will give you a lesser amount than the settlement amount! My balance is P20,000 but when I called to say I want pay up the whole balance, they said the amount goes up! What is happening here! I thought when you pay up, even at furniture shops, the amount would rather decrease. Is this fair to the consumer?

Let’s begin with the basics. Micro-lenders don’t lend people money because they’re kind and charitable people. They do so solely so they can charge interest on the amounts borrowed, that’s what the business is all about. The same can even be said for furniture stores. Here’s a startling fact. Most furniture stores aren’t really furniture stores, they’re moneylenders. Furniture is just an excuse to lend money to people and earn lots of interest.

Micro-lenders want every thebe of interest they can charge you and if you try and stop them getting it you’ll certainly upset them. That’s why, when you’ve agreed to pay them interest and then try and change your mind, they’ll charge you a penalty for denying them that interest. You’ll probably find that it says this, or at least implies it, somewhere in the agreement you originally signed with the lender.

However there is a VERY strict rule regarding settlement amounts. The “in duplum rule” is a rule that courts may apply whenever a case relating to debt reaches them. It says that at the time of settlement of a debt the amount of interest charged may not exceed the capital amount outstanding. If you owe them P10,000 the court will not allow them to charge more than another P10,000 on top.

This rule has been used many times in our courts so the next time a micro-lender tries to charge you an outrageous amount for settling a debt you should demand he takes you to court. The irony is that in this sort of case you’re safest in court.

Dear Consumer’s Voice #2

I have 2nd year credits at the University of South Africa and 6 to 7 years life and work experience in accounting. From your experience with lots of conversation and assistance with your clients, how does one go about getting a genuine and accredited University that converts life and work experience into a degree?

There are a few out there that are not bogus and accredited, but difficult to get them and be assured this is the right one. I have used my credits and experience to form a company for myself and now finding myself not getting enough time to complete my 3rd year.

Please assist me on this, if you know any genuine Institution, please inform me, it would highly be appreciated.

I'm sorry, I don't know where you got the idea that you can complete your degree with "life and work experience". This simply doesn't happen. There are no genuine universities that offer credit for such experience in completing courses. Real universities require coursework, exams, dissertations and research projects. They don’t just give away their degrees because you either ask them to, possess life experience or offer them money.

While I honestly respect your commitment to starting a business based on your experience, you cannot get qualifications this way.

Consumer Alert

We’ve heard from various people who asked about an “investment scheme” called Felmina Alliance. They’ve been told of amazing returns that can be made on modest initial investments. For instance they claim that you can earn 1.6% interest every day on an initial “investment” of $5,000.

That’s simply a lie. It doesn’t sound much but 1.6% per day, if it’s compounded, equals an annual interest rate of over 1,600%. There is no investment scheme in the world that can truthfully offer that, there never has been and there never will be. Anyone who says so is either a fool or a crook. Or both.

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