"How are you doing for money?" It's the most natural thing in the world: helping out a friend in dire straits. After all, there's often too much month left at the end of the money. We might be a bit skint, they're a bit flush, so we turn to a bestie for help.
But what would happen if, when we went to hand back the $50 to our best mate the next month, they suddenly demanded $158.11? That friendship wouldn't last the time it took our jaws to drop.
Yet that's the scenario with payday lenders such as Moola, Cash Converters or Save My Bacon.
When you convert the interest rate to an annual figure, they are in the region of 300 per cent or 400 per cent. Even north of 500 per cent is commonplace! The latest one I've come across, Pretty Penny, is aptly named, as in "It's going to cost you a..."
But we keep borrowing this way when we're in a jam. Or perhaps we resort to this approach in order to avoid having to borrow from people we're close to.