CASH ORDER FIRMS

Otago Daily Times, Issue 23830, 9 June 1939, Page 6

CASH ORDER FIRMS

STRICTER CONTROL IN NEW SOUTH WALES HAWKING TO BE BANNED (From Our Own Correspondent) SYDNEY. May 30. Strict control of cash order firms and definition of their business as money-lending will be provided in a Bill shortly to be considered by the New South Wales Cabinet. Proposals include limitation of the interest to be charged on cash orders and elimination of certain profits now made in addition to the actual interest charged. Inquiries made on behalf of the Government have shown that profits on some cash orders amount to as much as 50 per cent, per annum. The practice of canvassing for cash orders will be made illegal by the new measure. The practice is growing, and was the subject of a question in Parliament recently, when it was revealed that agents call at suburban homes and persuade women to take cash orders without the consent of their husbands. Under the proposed Bill, cash order firms will be required to carry on business only in a registered office. Hawking of cash orders from door to door will be prohibited. Interest on cash orders is mostly charged on a flate-rate basis, resulting in a high rate when calculated on a per annum basis. TO keep a check on these rates, it is proposed to empower a court to review cash orders if requested, and to fix reasonable rates of interest. s Official investigations have shown that it is a common practice for stores supplying goods for cash orders to give the issuer of the order at least a month’s credit before the order is redeemed, all to the benefit of the issuer Another practice revealed by the inquiry is that stores give issuers of cash orders a discount on the purchase price of goods. Thi« discount, it is claimed, should properly go to the buyer of the ’ cash order ; Clauses aiming at stopping these practices will be included in the new Bill, which will be in the form of an amendment of the Money Lenders Act, and will have the effect of making cash order firms moneylenders in the eyes of the law.