29 July 2019; MEMO: Kuwait’s National Assembly is currently discussing a bill recently submitted by several parliamentarians on “dropping all the citizens’ personal loans,” local media reported yesterday.
The lawmakers, including Mohammed Hayef, Mohammed Al-Mutairi, Thamer Al-Suwait, Shuaib Al-Muwaizri and Khalid-Al-Otaibi, had suggested that banks and financial organisations should “schedule all citizens’ consumer loans until 30 May 2019.” Under the bill, personal loans could be repaid for 12 years, except for Islamic banks waiving the loan incurred profits.
The draft law also prohibits the grant of interest loans to citizens; instead, it offers “funding citizens’ needs through an Islamic banking scheme.”
The parliament speaker, Marzouq Al-Ghanim, was reported to have referred the bill to the assembly’s legislative committee for further discussion on the possibility of the law’s implementation.
In April 2013, the parliament approved a law to buy some citizens’ personal loans and write off the interest after lawmakers argued that banks had overcharged Kuwaitis for credit.
Economists and government officials have repeatedly voiced concerns about the long-term sustainability of such measures. they say Kuwait should concentrate its funds on infrastructure development, not financial aid.
