Hip Hop mogul Russell Simmons has been facing harsh criticism for his Rush Card business. Marketed primarily towards low-income African Americans, Rush Cards are described as “no-credit-check, pre-paid credit cards with $200 credit limits and $50 a year in fees” by public radio program “The Takeaway.”
In an interview with the morning radio show, Boyce Watkins, a professor of finance at Syracuse University, compared Russell Simmons’ Rush Cards to pimping.
“It’s a very interesting sort of idea here,” Watkins said. “[Simmons is] saying ‘I’m giving everyone access to the American Dream,’ but I never really knew the American Dream consisted of having a piece of plastic that puts people further and further in debt. But even a pimp that helps — that quote unquote ‘helps’ — a young woman get off the street, he can say I helped you because you were homeless when I met you and now you’re not.”
After the New York Times published a blog which also showed Rush Cards in a negative light using quotes from the radio interview, Simmons made a statement firing back at critics.
“Since April is financial literacy month I feel this is a perfect time to set the record straight concerning comments I have been reading online about the Rush Card,” he said. “The Rush Card is a prepaid card, NOT a credit card. It gives people the convenience of a credit card without the debt. Financial literacy month is when people should know the truth about options to manage their money, not when misinformation should be spread to keep the underserved communities suppressed.”
Simmons went on to say that the Rush Card helps to protect underrepresented communities from the exploitation of bank entities and check cashing places who charge high fees for over drafting and the cashing of checks respectively.
“Some people pay a lot to have a bank account. The average US household pays over $340 a year in bank insufficient fund fees. In fact, most of these are paid by members of underserved communities totaling over $1,300 per year per household.”
Recently, Rap group, the Young Guns Now also criticized the Rush Card for its activation fee of $19.95.To read Russell Simmons’ full statement on the Rush Card, [click here].