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Defaulter or insolvent?

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As one of those who lived through the financial crises that Kuwait went through since 1981, I was one of those who worked on establishing the Department of Dealing with Difficult Debts during my work in a Kuwaiti bank. I dealt with all sorts of debtors, from the poor to other fools and thieves, as well as honest borrowers, who form the vast majority of debtors, and I have realistic stories that can disturb your peace, and some of them cannot be believed, but not for this article. My topic today is about the draft law for dropping loans submitted by some members of the National Assembly, and everyone knows what happened in this session of loud voice, screaming, and discussion, which unfortunately became for some a hateful style of communication that dominated our customs and traditions, while respect and rational discussion for some became weakness and humiliation. I return to that law, and I do not want anyone to be disturbed by what I am going to say, but this law is flawed, superficial, and unapplicable, and everyone knows that it will not be passed, and if the government passes it, it will be nullified by the Constitutional Court if it is approved in its current form. I think that the sponsors of this law do not lose sight of this matter, but it may be, as it is said, "for ulterior motives." I also set aside this law and talk about the fait accompli. There is indeed a crisis facing a large segment of citizens, both borrowers and non-borrowers, and that segment needs support; there is no doubt about that. But there are borrowers who are not from that segment and including them in the law is not a solution and is not a matter of justice. Also, the government figures related to the rate of defaulters amounting to 2.44% do not mean that there is no crisis, as this figure is professional and accurate and reflects the percentage of defaulters. There are many rules that regulate the term "defaulter" with lending institutions and are subject to the supervision of the Central Bank, and I think that the problem between the National Assembly and the government lies in the communication. For example, if one of them speaks in Chinese and the other responds to him in French, how will they understand each other? The government believes that with this percentage there is no crisis, which is true, but the members confuse the needs of the citizen with their electoral matters, and some of them may have a different agenda. Let me translate for them. There are three types of debtors: defaulters, insolvents, and solvents. The defaulter is someone who has stopped paying installments for a number of months, and that does not mean that everyone is under legal procedures; these are the owners of the 2.44% rate that the government is talking about. As for the insolvent, he is a borrower and is committed to the terms of his loan, but he and his family are threatened at the end of the month, and any emergency crisis could bring them down to the poverty line, and such people, according to my estimation, may reach 40% of the borrowers, and these are the ones the deputies are supposed to talk about. Well, the rest of the solvent, which may reach 60%, whose situation is excellent and whose salaries are high, and who may include ministers, members of the National Assembly, leaders, doctors, and other high-income earners, why are they included in the law? Well, there is a worthy question: how can we equate a borrower who has completed building his house with another borrower who obtained a loan in order to travel as a tourist or to buy a Rolex watch? Is it fair? There are also insolvent citizens who do not borrow more than the number of borrowers; who will help them? How will he assist them? Are they punished for not borrowing? And there are citizens who own small projects who were implicated by the government during the Corona crisis and were only given an extension period to pay off their debts; for your information, their debts are classified as commercial debts, even if they are small, and they are not subject to this law.  So, how will you deal with the borrower who has paid 99 installments but still owes one installment, and another who has paid one installment but still owes 99 installments? Well again, after paying off the loans, will you allow them to borrow again, or will they be forbidden? We must not forget that there are debtors in prison who are the result of debts and negligence, and they need someone to sympathize with them through a law or a special pardon. I believe that the solution comes from raising the income of the citizen and controlling inflation through a statistical study conducted by the specialists, through which we know who is the defaulter, who is the insolvent, and who is the solvent, and what are the sufficient support mechanisms to alleviate the suffering of the citizen in a fair manner and at the same time to maintain the sustainability of the financial state.

Stay Safe.

عدد الزائرين:

85 زائر، ولايوجد أعضاء داخل الموقع

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