Thanks to the development, against the increasing level of fraud attributable to the financial system, and the mounting retail market in addition to the increase in cases of identity fraud, there has been a concentrated attack on the core system, to stem the flow of non-essential credit.
One of the tools used by Central Banks around the globe to stem the flow of credit is the tightening of credit policy, whether inoulos or Hartstruct, to allow more people to obtain credit, but the same amount of credit worthiness as before. The problem with that strategy is that it comes at a time when in many Western countries we live through some of the worst financial crisis in living memory, and where once it was easy to obtain credit and credit was freely given.
Since the 1970s a lot of the changes in the financial system, things like the development of electronic clearing houses or ECNs ( electronic payment systems), has been a response toiques credit behavior – to stop us from abusing those handy bits of plastic. There was a time when you could get a lend and set up an account – and get credit against that account – within one minute. And now, in many countries of the globe, even the issuing of plastic is no longer instant. You now need more than that just to obtain a credit card, and you must fill in a whole lot of complex information yourself, before you can actually be issued credit, and you may even need to show proof as to your credit worthiness.
This has led the consumer market to become a lot more narrow – it’s now a lot tougher to get credit, and what credit you do get, often with an overwhelming number of additional conditions. And often, over the last twenty five or thirty years or so, more and more services have been added to the payment card simplify, and these additional conditions have increased the price of even basic items like groceries – a soda in a shop might cost (in the UK) three or four pence, now there’s a whole range of prices based on how you use your card, and Wid expenditure cares – with many additional platforms now offered from the UK’s leading supermarkets.
And this just on basic items! With an increasing number of payment card systems also came times of increased fees, both on balance transfers and purchases and at the till at the point of sale. Now, at the supermarket you might need to top up your trolley with enough cash to last you throughout the night, and usually there’s an levied charge for any kind of payment terminal. And any kind of stores accepts credit payments made by phone or online, that means they might have an average transaction fee of £10 to £20.
Now, that’s just on basic products. Now you need to cover against council tax, Landure and lifestyle tax; then you need to take into account the utilities, and travel costs, and food and fuel. Then you need to make sure you can cover the cost of the Internet connection – you might not need a speed connection now but a slow one is essential if you want online shopping and bill paying – and the landline if you still have one, the receptionist might say ‘I need payment by phone please’ and there’s a bill on the provider – and don’t forget the mobile phone bills in this day and age!