Sioux Falls based credit card company targets "subprime" borrowers with freakish interest

h/t Dr. David O'Hara who shared this on Facebook.

Premier Bankcard, based here in Sioux Falls, will carry a 79.9% interest rate to evade fee limits that go into effect in 2010.

According to the report from msnbc,

"In a mailing sent to prospective customers in October with the revamped terms, First Premier writes '...you might have less-than-perfect credit and we're OK with that.' The letter notes that an online application or phone call is still required, but guarantees a 60-second status confirmation.

The letter also states there are no hidden fees that aren't disclosed in the attached form. That's where the 79.9 percent interest rate and $75 annual fee are listed. There's also $29 penalty if you pay late or go over your $300 credit limit.
Even if First Premier doesn't stick with the 79.9 APR, it will likely hike rates considerably from the current 9.9 percent to offset the lower fees..."

I've blogged about the Biblical condemnation of usury several times. You can type usury into the search function atop this blog and it will lead you to a number of posts. The bottom line is that God doesn't like it and places the moral onus on the lender, not the borrower.

It goes without saying that Christ is grieved by a culture that expects people to pile up December debt to celebrate his birth. The Word became flesh and dwelt among us...full of grace and truth becomes something like "God sent us this great deal, albeit with high interest and hidden fees in the small print."

Despite the Biblical clarity, usury presents moral conundrums today. To eliminate it would cost many South Dakotans their jobs in the lending industry. First Premier's owner is South Dakotan T. Denny Sanford, who has used the wealth generated by the lending industry to become one of America's top philanthropists, including a substantial research project grant to attack juvenile diabetes. (I work part time in a medical system named for him and carry my family's medical coverage through their plan - so I guess you can say I benefit from usury).

The private sector isn't the only problem. Government programs aimed at present social problems are funded by financially encumbering future generations. My wife's Social Security disability has relieved our financial stress - but one might rightly argue that this is essentially money that future generations will struggle to pay for.

And so we come back to the Christmas message, don't we? In a world full of good intentions and unintended consequences, clear standards and cut corners, we do not find perfection. But the Word became flesh in Jesus, And it is by God's will that we have been sanctified through the offering of the body of Jesus Christ once for all (Hebrews 10:10). We are saved by a gift, pure and simple. Found treasure on the manger floor.