Reference no: EM132666306

The charity for one parent family said banks and other lenders continue to discriminate against single parents and force them to pay more for credit. Single parents struggling with debts are ill-served by the banking industry, which punishes them with high interest rates on loans or refuses to offer credit at all, pushing them into the arms of doorstep lenders who charge between 50% and 190% interest on loan products.

• The charity revealed in a report the wide-ranging problems faced by lone parents. They were more likely to use overdrafts, credit cards and personal loans than couples with children. Almost half (48%) of single-parent families had been in arrears in the past year, compared with a quarter of two-parent families. Even those single-parents who choose to work often fail to free themselves of short-term and costly debts. The incidence of debt among working lone parents is twice as high as among couples where one person is in work - 14% compared to 7%. Like other low-income groups, single parents will often be shy of opening a current account, fearing excessive surcharges for unapproved overdrafts or bounced cheques. The charity recommended that banks had to do more to make basic bank accounts easier to open.

Required:

Problem a) Apply the managerial perspective of Stakeholder Theory to explain whether bank management would care about the recommendation of the charity for One Parent Families.

Problem b) If we applied an ethical perspective of Stakeholder Theory, should bank management care about the recommendation of the charity for One Parent Families.