In line with Qatar’s booming economy, the number of medium companies has gone up. A large number of new workers have joined the country’s burgeoning labour force. As most of these companies are not included in the “approved list” of banks, credit facilities are being denied to their workers. Keeping away such a large section of people from participating in the economic activity does not augur well for any economy, experts argue.
But bankers point to the increasing loan defaults. Some banks have suffered bigger losses than those by others because there is no insurance attached to personal loans. There is a steady increase in the number of expatriates ‘slipping’ out of Qatar after taking loans. International investigating network teams have set guidelines for tracking down the offenders. Banks have to carefully monitor the status of their credit facilities, especially in the current economic climate with regard to redundancies, say experts.
In contrast, prominent Qataris warn young nationals against their growing credit craze, as banks are lending huge sums without properly assessing their repaying capacity. This is creating problems in families. Hundreds of cases of bounced cheques are coming to courts daily, Mohammed Al Thamimi, a lawyer, says, adding about 51.1 percent of the cases were heard by the preliminary court last year.
Family disputes over consumer loans are one of the major reasons for break-ups, shows data released by the Family Consultation Centre. An estimated 30-40 percent divorces are happening due to disputes over repayment of loans, Al Raya reports.
