Newspaper article The Journal (Newcastle, England)

If One Man Can Provide an Honest Banking Service, Why Can't the Big Boys Do It Too?

Newspaper article The Journal (Newcastle, England)

If One Man Can Provide an Honest Banking Service, Why Can't the Big Boys Do It Too?

Article excerpt

Byline: DENISE ROBERTSON

BRITAIN'S banks are now thoroughly discredited. We were told they were victims of a global crisis but, if that was the case, why were banks in Australia and Canada relatively unaffected? Why is there, as yet, no Libor crisis elsewhere? The problems of AIG, Lehmans and UBS, all foreign-owned, appeared first in their London divisions and voices in America are asking why. Argument will rage 1

When banks started refusing loans to his customers, they could no longer buy his products. "It was killing their businesses and damaging mine," he says, so he decided to go into the credit business himself.

Today, hundreds of businessmen and women hold accounts at his modest town centre shop, known locally as the Bank of Dave, where you will find the old, face-to-face banking we miss so much. He says: "Burnley's going through a tough time, like most of the country. But there are a lot of decent, hard-working people in this town and they're the people I wanted to help."

The Bank of England base rate is 0.5% yet small businesses can pay up to 20% for loans while savers receive as little as 0.05%, or even nothing at all.

Dave charges 8.9% to borrowers with a good credit record and investors make 5% on their savings. The profits go to charity. Only one borrower has defaulted so far. Savings are pouring in and there is a waiting list for investors. The pounds 10,000 profit accrued in the first six months has been divided equally between five local charities.

Dave says: "The banks have been ripping people off for years. They used to have a responsibility to serve their clients. Now they just serve themselves. We bailed them out but they still pay themselves obscene bonuses and refuse to lend money to businesses fighting for their lives."

A two-part series, The Bank Of Dave, starts on Channel 4 on Thursday. …

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