11/06/2005

Personal loans spell doom for borrowers...

Vol XXVIII NO. 83 Saturday 11 June 2005

By Amira Al Hussaini


Why is it that we have to keep up with the Jones' in everything we do?

Can someone explain to me why Bahrain is a nation in debt, with BD1 billion outstanding in personal bank loans?

The question here is how much of this money is the size of the actual debt and how much is interest incurred by unscrupulous banks, who try to sell poor people castles in the clouds?

Also, how much of this money actually went on necessities and how much more was spent on luxuries, from cars to expensive, sprawling homes, honeymoons and holidays to exotic locations, lavish weddings and education and treatment abroad?

I personally hang up on salesmen who call asking me if I want yet another credit card, or up to 20 times my salary in personal loans, with no questions asked.

I don't need to even think about it because I know that I don't want to get sucked into a vicious circle which will tighten a noose around my neck and make me regret every fil I borrowed, once the creditors come knocking on my door.

If I regret anything, it may be the rude way I attack those salesmen, who are probably working to pay off loans themselves.

People have the right to dream and fulfil their aspirations, but taking loans to make those dreams come true is like sinking into an abyss.

I know people who are scraping the floor to make ends meet and to pay those parasitical banks their loans, topped by an interest very close to the amount they borrowed, just because they wanted to show off with a flashy car and enjoy the perks of a first-class holiday.

My heart breaks every time I see a young couple borrowing money to start their lives and I wonder who really is behind this debt culture, which is reducing people to slaves, who work and toil all day just to pay off ridiculous interest rates.

I know that waiting to achieve a dream is difficult and not many people have patience, especially when advertisements for personal loans are so tempting and are now seen on billboards in the streets.

They even intrude into your privacy in the form of SMS messages on your mobile, whetting your appetite and making you drool for what you can have instantly in exchange for a cut of your income forever after.

Loans may be an easy solution for a sticky problem which is available over the counter without the need for a prescription.

But they are a hard pill to swallow and will impose dire consequences on a young nation, which will be shackled for years paying the price of what they enjoyed for only a few hours, days or months at the most.

Comments

People must take responsibility for their actions. If they swallow too much debt they will have to learn the hard way on paying it back. However there does need to be some tighter regulations on the lending on money. Low base salaries and banks willing to lend money to those who don't make much are a prescription for problems. Catch 22. How is one who makes 200 bd a month going to afford a car to get to the job in Manama when he lives in Riffa? Take the bus? A wonderful Bahraini Taxi? We are all living in a "I WANT IT ALL AND I WANT IT NOW" society. Doesn't matter if you live in London, NYC or Bahrain.

I don't think Bahrain has much in the ways of a "bankruptcy" system or laws. You owe it you will be forced to pay it. Wages garnished if needed. Still I think it falls back to being responsible for ones actions. You have exercised your control with one little word when the banks come a callin' ... NO.

Posted by: ShawarmaBoy | 11/06/2005

....this is the very reason interest was declared as being haraam...both taking and giving. Only the poor man borrows and the rich save so the poor gt poorer and the rich richer...

Posted by: smurfs | 21/06/2005

ok

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