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The credit card industry as it is today is targeting people who they know cant afford to pay back any money they run up, and the large and unregulated scope for interest charges means that some of these people who aren't researching the different cards available, are being charged massive amounts more than they borrowed in the first place.

Regulation of the credit card industry, (and the loan industry for that matter), by the government, would mean less and less people would be in debt every year, and that more people could afford things like housing and to keep all their bills paid every month. For some people having credit cards is like giving them a license to print money in their own minds, and they spend not thinking about how they will pay back what they owe.

Making it a lot harder to get a credit card, and then tightening the regulations regarding overdrafts and interest charges would make this situation a lot better for a lot of people, and would take the decision to spend recklessly and to get into debt out of the hands of people who clearly can't make those decisions for themselves. Perhaps a good idea would be to have credit card availability and credit levels means tested so that people can only spend a certain amount of their monthly income.

Credit cards in themselves can be a useful thing to have in emergencies or if you are waiting for money to be paid into your account. The problems occur when people start to rely on them and begin to overstretch themselves to the point that all their wages are paid out again every month, and they have to use credit to pay for everything else. Making this process impossible to start, or at least very much harder than it is now, would force people to become more responsible with their own money seen as a lot of them can't do it for themselves.

Learn more about this author, Scott Heritage.
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