What, what, what??
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Actually, I think you had better contact your State's Banking Association and see if this is legal. If this school is mid to high school...there may already be a banking program in the school. Honestly, you should be working to provide a banking program that has a slightly higher than normal interest gain for them. NO LOANS. Talk about possible misuse and handling of personal funds at an early age! You want to teach and encourage children to save and learn investing, not suck the money out of them and encouraging spending. I think its kind of unethical, personally.
I'm not saying that teaching responsible money handling is out of the question for children...it should be mandatory. But, real loans are part of adulthood for a reason. |
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leaptad
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What about your business model would entice people? Why would they choose you over the credit union? Honestly, if you aren't going to be a part of FDIC, etc, I certainly wouldn't borrow money from you. |
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sharon
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how much interest r u going to charge? depends on that |
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psych_78
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No!! because what if people take out loans and do no or cannot pay back?? Then their parents would have to pay and I don't think they would be happy that their child got into debt with a school 'bank' |
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WBWs' Babe..
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In some ways it does sound like a good idea but how would you deal with someone who hasnt paid off a loan and is gaining interest? Im not sure the same rules would apply in the eyes of the law as it does with other banks.
A good idea but a lot more thought and research should go into it before you think about starting it.
Good luck |
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Biz Guru
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Bad idea - there are laws you have to comply with to lend money and it is illegal to borrow money under the age of 18! How would you collect from the borrowers who did not pay up?
Good that you are thinking like that - but not a good concept unfortuantly. |
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BARROWMAN
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No and your teachers should know that to lend money and charge interest without the proper authority is a crime and is known as usury or loan sharking. It is vertainly not a career path or school activity that should be encouraged |
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on the wagon
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are you related to richard branson by any chance |
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skcs69
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A lot of banking laws you would have to follow. |
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rodandalisonthompson
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You need to bear in mind that people under the age of 18 cannot enter into a contract. What are you going to do if they dont pay you back? |
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Beth
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Not a good idea.. Do you have any idea what kind of potential LEGAL issues there could be if students were involved in such an ordeal? Scary to think of that! |
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Marko
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Very enterprising idea. However, the lending industry is highly regulated. Security issues aside, you don't want to create legal problems for yourself.
Private lenders aren't held to all the same restrictions as chartered financial lending institutions. If "deposits" are regarded as speculative investments in specfic projects, then you might have a way to proceed. I highly recommend checking the legal aspect of this venture. Good luck. |
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Judge Judy of Y/A
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Doesn't sound like there'd be much money in it for you. Interest rates are low and you'd have to make big loans for long periods of time to really make any money. And what are you going to do when the students don't pay back their loans. |
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bonnieG
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yes it is a good way to learn how to handle your finances |
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