Pay-Day Loans

The general perception of Indians about America is very different than reality. The ‘land of opportunities’ unfortunately, has its share of poor/struggling people. This is accentuated by the fact that most people are forced to live paycheck to paycheck. The recent recommendation of ‘Dirty Money’ show on Netflix (by a colleague of mine) brutally exposed to me the condition of nearly significant part of the American population.

Families that run out of money towards the end of the month can borrow $500 or more from these pay-day loan websites/shops. However, like the ugly concept of ‘kandhu vaddi’ (loans based on exorbitant daily rates) in Indian states, this has a horror part attached to it.

In the show, one of the borrowers borrowed $500 and expected to pay back $650. He then proceeds to pay his 4 installments of $150 expecting only a remaining balance of $50. However, he is in for a shock, as the $600 he had paid only keeps the loan amount active and has never decreased the principal amount. He ends up paying nearly $3000 for the $500 he had got in the first place. The show specifies that the ‘pay day loan’ companies often are registered to Indian tribes (Red Indians) which complicates matters as the State government does not any jurisdiction over Indian tribal land (something that bewildered me even more). The owner of one of pay-day loan company enjoys an extravagant life style and is prosecuted by the federal government for various financial crimes, pending a judgment from the supreme court.

The similarities of the brutal lending scheme in our country runs a parallel with the ‘Pay-Day’ loan scheme in no less measure. What astonished me is the fact, that educated lower-middle class people in America are caught in this debt-trap, which I would say has engulfed nearly all our farmers, forcing them to commit suicide.

All said and done, greed for money and power unfortunately plays a major role in our life throwing aside humanity and goodwill. I hope that our future generations can at least enjoy the happiness and peace that we have enjoyed through our stay on this beautiful planet.