British credit card issuer Provident Financial has launched a credit card that carries one of the highest annual percentage rates you’ve likely ever seen or heard of.
According to the Times Online, the Bradford, England based bank is offering consumers with poor credit a credit card that carries an APR of 183% if they borrow money over a period of about a year, or a whopping 365% if they choose to borrow for just 31 weeks.
So assuming a cardholder takes out about $600, which happens to be the maximum credit line, they’ll end up paying back roughly $1,000 throughout one year, or about $900 in just over half a year.
That’s a pretty penny, but also the cost of having terrible credit history and no steady paycheck.
Seems like a different level of subprime lending, considering it’s 10 to 30 times the typical APR of 10-30%.
The only bright spot, if you can call it that, is that Provident supposedly doesn’t charge any late fees.
I guess with an APR that high, additional fees aren’t necessary.
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(photo: jamesjordan)
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