People nowadays are not fit and active than the people from the olden days. Discuss the causes for this situation and suggest some possible solutions.
Sample Answer:
In today’s society, credit cards have become a common tool for managing finances and making purchases. However, it is undeniable that many individuals have fallen into financial hardship due to their irresponsible use of credit cards. This has led to a debate on whether banks and other financial institutes should issue credit cards only to individuals who are completely sure of their ability to pay back their debts. In my opinion, I agree with this statement to a certain extent, as responsible lending is essential for the financial well-being of individuals and the stability of the economy.
First and foremost, it is crucial for banks and other financial institutes to conduct thorough assessments of an individual’s financial situation before issuing a credit card. This includes evaluating their income, expenses, and existing debts to ensure that they have the ability to manage and repay the credit card balance. By doing so, financial institutions can mitigate the risk of lending to individuals who may struggle to make repayments, ultimately reducing the number of people falling into financial hardship.
Furthermore, responsible lending practices can also help in promoting financial literacy and responsible money management among individuals. When individuals are aware of the strict assessment process for obtaining a credit card, they are more likely to be cautious and responsible in their spending habits. This can lead to a reduction in the number of individuals accumulating high levels of credit card debt, ultimately contributing to a more financially stable society.
However, it is also important to consider that there are individuals who may have the ability to repay their debts but do not meet the strict criteria set by financial institutions. This could potentially limit their access to credit, hindering their ability to make necessary purchases or manage unexpected expenses. Therefore, while responsible lending is important, there should also be a balance to ensure that individuals who are financially responsible are not unfairly excluded from accessing credit.
In conclusion, I believe that banks and other financial institutes should exercise caution and conduct thorough assessments before issuing credit cards to individuals. Responsible lending practices can help in reducing financial hardship and promoting responsible money management. However, there should also be a balance to ensure that individuals who are financially responsible are not unfairly excluded from accessing credit.
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