UAE President HH Sheikh Khalifa bin Zayed Al Nahyan offers lifeline by clearing loan payments of Emiratis whose money matters have ended in court
Thousands of Emiratis facing jail or languishing behind bars over money problems have had their debts wiped out by the UAE President.
HH Sheikh Khalifa bin Zayed Al Nahyan announced yesterday that certain Emiratis with debts of less than Dhs1 million will benefit from the presidential decree.
The lucky recipients are those who are in detention or awaiting trial for debt troubles. Those who are settling their debts through installment schedules set by the courts will also have their outstanding payments cleared. The Dhs2 billion worth of debt, racked up by 6,830 Emiratis, will be repaid on their behalf, national news agency WAM reported.
Those in prison will be released and have their loans settled. However, they must then hand over 25 per cent from their monthly salaries and agree not to borrow again until they have paid back what they owe. The move is part of a drive launched last year to help low-income UAE nationals who find themselves swamped by debts.
In November, a Dhs10 billion presidential fund had been set up to help Emirati families struggling to settle their debt problems. Financial analysts said the promise from debtors to pay back from their salary will help to instill a level of financial discipline.
"This will help to make them understand the weight of their liabilities," said Guy Olson, financial advisor at Holborn Assets. Another financial expert told 7DAYS that while Emiratis account for less than 20 per cent of the population, official data shows that personal loans taken out by UAE nationals accounted for more than a quarter of the total provided by banks in the UAE.
© 7Days 2012
