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Some car finance companies in the United Kingdom are installing devices that can immobilize their customers’ cars when they fail to pay on time.
In an attempt to ensure on-time payments, some lending companies have installed GPS devices on cars of customers with bad credit ratings or those with a history of not being able to pay on time. These GPS devices allow the companies to remotely prevent their customers’ cars from running.
Whenever customers pay their monthly dues on time, they receive a code from the lending companies. This code must be inputted on the GPS device to prevent the cars from being immobilized. The codes are changed every month. If customers miss a payment, they will not receive a new code, preventing them from using their cars.
Multiple concerns have been raised about the GPS devices. One is the possibility that drivers will be marooned in a potentially dangerous situation if their cars suddenly stop. However, the Car Finance Company, one of the lenders that use the device, assured that emergency codes are given to allow drivers to move their cars to a safe place.
Several critics have also raised concerns that the method is not fair. One critic said that it may be against the law to immobilize cars without giving drivers a grace period to settle missed payments. Another critic raised the possibility that lending companies may be enticed to grant loans to customers who cannot pay them back, knowing that the cars can be repossessed once the customers stop paying.