28 November 2008

The Credit Crunch Hits (Rented) Home

Today I visited my bank in Edinburgh, with an eye towards getting a credit card through them. I don't intend to spend a lot of money, but I'd like to have the added insurance that credit cards offer over cash or debit cards (in light of travel company XL's recent demise), and want to avoid the extra commissions for using an American credit card in the UK.

Unfortunately my quest ended in failure. The customer service agent informed me that, since I carry no debt or mortgage (HA!), and spend very little of my savings, my credit rating is too low. So unless I spend more of my money, I cannot be trusted with a credit card -- even one with a credit limit linked to my account balance, which I suggested. In addition, my Peace Corps service kept me off the financial radar for two years, curtailing my opportunities to establish my profligate bona fides. This proves the old adage, No good deed goes unpunished.

A few weeks ago I read an article in the Economist stating that many African countries, due to their relative detachment from world financial markets, should not be as adversely affected by the international financial crisis. [In general, the article is cautiously optimistic about Africa's current prospects.] At the time I mused that I was analogous to these countries as I have not been caught up in the global financial tumult given my lack of investment (or liability).

Alas, I was incorrect in this assumption. As banks have belatedly moved to tighten their lending and credit provision strategies, I remain out of the UK financial loop, at least for the next six months.