The Barefoot Investor says he has been barraged with legal letters after writing a column where he fiercely criticised a short-term money lender.
Finance guru Scott Pape blasted non-bank lender MoneyMe last week for boasting about how they funded a couple’s lavish $92,000 wedding with a personal loan.
In a newspaper column titled This Will Get Me in Trouble, Pape slammed the PR pitch he received from MoneyMe as the worst he’d received in more than two decades.
He blasted the company’s media release – ‘clearly wanting me to write a heartwarming story about a Brisbane couple who spent $92,000 on wedding celebrations, funded in part by a MoneyMe personal loan’ – as ‘tone-deaf’.
‘I’ve been writing this column for 21 years,’ Pape said, ‘and this is hands-down the worst PR pitch I’ve ever received.’
The MoneyMe media release quoted the bride saying: ‘I’ve definitely felt the impact of the cost-of-living crisis.
‘We spent more than we imagined … but we wouldn’t trade the memories for anything.’
Barefoot Investor Scott Pape (pictured) has criticised a short-term lending company for using newlyweds as promotional props to spruik its products
Brisbane couple Julie and Dean (pictured) partially funded their $92,000 wedding with a loan from MoneyMe
The media release then went on to quote MoneyMe chief executive Clayton Howes touting the benefits of getting a personal loan during a cost of living crisis.
‘With cost-of-living pressures, personal loans are helping some Australians hold onto life’s important moments without compromising their financial stability.’
Mr Pape took issue with the company’s claim that high-interest loans during a cost-of-living crisis wouldn’t compromise financial stability.
He said MoneyMe charges customers between 5.99 per cent and 26.99 per cent per annum with a $495 establishment fee and a $10 monthly fee.
‘MoneyMe are smart marketers. They’ve ticked corporate responsibility boxes, snaffling a B Corp certification – a sustainability credential demonstrating commitment to social impact. So, they’re using ‘positive impact’ language while encouraging people into debt for celebrations they can’t afford,’ he wrote.
‘There ain’t anything sustainable or socially impactful about taking out a MoneyMe loan.
‘It’s the same debt it always was, except now it comes with a B Corp badge and some feel-good language about ‘financial inclusion’.’
MoneyMe chief executive Clayton Howes (pictured) said the company closed the 2024-25 financial year with a loan book of $1.61 billion, an increase of nearly 30 per cent
Mr Pape likened the marketing to the trend in processed food to add protein to make it appear more nutritious.
‘The product hasn’t changed – just the marketing. It’s still the same ultra-processed crap designed to clog your financial arteries while making someone else rich,’ he said.
MoneyMe has since removed the post of the newlyweds from its website and socials.
In Monday’s column, which is sent to around 400,000 subscribers, Mr Pape said he was having the ‘week from hell’ partly due to his swipe at MoneyMe.
‘Right now I’m surrounded by more nuts than a fruitcake,’ he wrote.
‘I have legal letters firing around from a column I wrote last week.’
A MoneyMe spokeswoman said it did not have legal proceedings against Mr Pape. However the Daily Mail understands it has requested Mr Pape change the wording of his column.
‘MoneyMe has a comprehensive responsible lending framework in place and provides loans to customers with strong credit profiles,’ she said.
‘MoneyMe’s hardship approval rates are high and above the industry average.’
MoneyMe promotes personal loans on anything from holidays to cosmetic surgery with its socials using pictures of young people attending Coachella and Burning Man
The company’s advertising material says that it offers up to $70,000 with an online loan application process where ‘decisions are made in minutes, and funds can often be in your bank account the same day.’
Car loans have driven a lot of the company’s profit with gross revenue hitting $58million in the first quarter of this financial year.
MoneyMe also promotes personal loans on anything from student loans and holidays to cosmetic surgery with its socials using pictures of young people attending Coachella and Burning Man.
One blog post states a personal loan ‘could be a smart way to fund your festive activities this year’.
Mr Pape said financial counsellors had told him MoneyMe can often be a nightmare to deal with when clients get into trouble and were ‘worse than the banks’.
Finance expert Sarah Wells said the new wave of short term loan products were no different to the pay day loans of yesteryear.
‘Encouraging someone to use tomorrow’s money to pay for today’s wants is not really disruptive it’s more disturbing,’ she said.
‘I’d like to see real disruption where providers consider something like meeting the need of the consumer.
‘Real disruption could look like – hey let’s do this loan but how about we teach you how to budget and look at advanced repayments and show you what $27 a day into super, a mortgage or even an investment may look like in 10 years time.’
