Technology to the Rescue
Loan companies and automobile sellers are installing electronic repossession devices that kick in if a buyer misses a payment. One California-based company has equipped a quarter of a million cars with its “On Time” automatic repossession device, which flashes colored warning lights to the driver of a car bought on time as loan payment day approaches.
The light is green when you’re good; when your payment is due it turns yellow. If, despite the reminders from “On Time,” the driver does not make a timely loan payment, the device will start beeping all day so you know it’s the last day before shut-off and soon you’re not going to be able to start your car.
When a payment is made, the driver is given a code to type into the stalling device, and the car can be driven again. “On Time” devices also include a Global Positioning System (GPS) component, which allows lending companies and banks to track and repossess a vehicle if the buyer defaults completely on a loan.
“On Time” sales grew by 30 percent in the first quarter of the year, and is beginning to move into overseas markets, with distributors in Britain, China and Dubai.
The company has plans to fit “disablers” on other big-ticket items, such as photocopiers or printers.
Life would be so much better for business if it wasn’t for them damned pesky customers. Eh?
73 de Jeff
May 2nd, 2008 at 6:36 am
When I first rented a “flat” in Britain, I was surprised to learn that it was a “feature” that the flat didn’t have the usual Coin-Meters.
These Meters had to be fed, with cash, to keep the various utilities on.
Do notice that with the Car Immobilizers the units are being used to make sales to high credit risk customers.
Expect there is little other way to offer major ticket items like cars to folk who have earned the priviledge of otherwise being excluded from the market.
Redemption of the unworthy through technology. Interesting!
73
Steve
K9ZW
May 2nd, 2008 at 8:35 am
Excellent idea. The costs of consumers who don’t pay what they owe runs into the billions. And in turn this drives the price of goods higher for those who meet the terms of their payment arrangement.
A Harvard/Dartmouth study released in April of this year declared that Americans are “financially illiterate”. And we know of course that the USA is a debt ridden society. Not to mention that we live in an entitlement culture where the illusion of affluence is possible via leasing and soft loan terms. (The best example being home ownership as a birthright.)
The left loves to blame corporations and alleged poor regulatory oversight Personal responsibility is seldom invoked as causality.
It’s an idea whose time has come.
May 2nd, 2008 at 10:08 am
Or… these companies could simply stop making loans to “high-risk” customers and save all those “billions” of dollars lost to bad risk clients.
But that’s not likely to happen since lending institutions charge significantly more interest on loans to higher risk individuals which apparently more than offset those losses else they wouldn’t make cheesy loans – would they?
I’ll offer up some genuine concern for the solvency of lending institutions when they stop sending my Labrador Retriever offers for credit cards with $20,000 limits…
:-)
73 de Jeff
May 2nd, 2008 at 2:11 pm
Making loans (whether in Money or in Financing) follows the same laws of economics as any other risk/return relationship. The higher the risk, the higher the rate of return to fund it.
As a soceity it may be more useful to have some form of credit, even if accompanied by gizmos enforcing the contract to pay for the goods, than have these folk made evern more of an underclass.
And it might make the lenders some money too, which is a good thing.
As for silly mailing lists there are just a few steps difference between a promotional mailing and actually making a credit line available !
73
Steve
K9ZW