The government and in particular Finance Minister Aiyaz Sayed-Khaiyum have consistently highlighted the vicious circle of money lending in which many Fijians are caught. It seems that the more these
The government and in particular the Minister of Finance Aiyaz Sayed-Khaiyum, have constantly highlighted the vicious circle of money lending in which many Fijians are caught.
It seems that the more these people try to get out of this cycle, the more they sink into this cycle because of the high interest rates charged by money lenders.
The local HFC bank is working to help Fijians break free from this day-to-day payment cycle. He launched 2016 as the year of “Breaking the vicious cycle of lending money”.
HFC Bank Treasurer Peter Fuata said one can get an HFC loan to pay off existing debt from the money lender.
“The repayments are then channeled towards their savings. In conclusion, about the 20 percent or so that was paid to the money lender now belongs to them, ”he said.
“The key ingredient is honesty in disclosing all of your debts, making a commitment with HFC Bank and pursuing your dreams.”
But Mr Fuata stressed that they were not selling products but were selling a genuine intention to help and, by default, a culture of savings.
“So, for example, a loan is either secured or unsecured. All the banks sell this, ”he said.
“However, at HFC Bank we have looked at unsecured loans as an example of a product that can help all Fijians consolidate all their debts.
“It means less interest charges and more money in our pockets or in our savings.”
Mr Fuata said that in Fiji unforeseen or unaffordable desires are borrowed.
“These are the main reasons attributed to the over-indebtedness and then the money lenders that people are stuck with on payday,” he said.
“So financial literacy is financial discipline with money. “
Sun INTERVIEW – Peter Fuata-HFC Treasurer of the Bank
What kind of change do you hope to make with this scheme?
A culture of savings. Needless to say, this is not a new theory. However, it is a strong reminder that we need to put it in a local perspective.
It’s monotonous these days to tell people to save, save, save. But if we say, don’t live your life from “pay day” to “pay day”.
Do not go and “kerekere” every time there is an opportunity in the life of a loved one. So I guess it’s more meaningful.
Your ATM card is legally only for you and not for a third party.
How many people do you think are trapped in the “vicious money lending cycle” and how serious is the problem?
The last article I know of was written by the Fiji Institute of Applied Studies for the Consumers Council. So, like all data from the Pacific, it is either overdue or taken every five or ten years.
The 2007 results were that 11 percent of households used a money lender, so statically it is assumed that 11 percent of households in Fiji use money lenders.
Today, according to the Bureau of Statistics, there are around 180,000 households. So mathematically, seven years ago, about 20,000 families were affected.
In the same report, FICAC found 500 ATM cards in an unlicensed store in the North. So if we took 500 cards and multiplied that by about 2,000 registered, unofficial money lenders, that would make a million ATM cards.
In conclusion, the observations of many ATM money lenders in 2015-16 are a regular occurrence, so more evidence.
What is the main factor that these people are caught in this cycle?
It is simply because of a cultural flaw that we cannot say “no”. Even when we don’t agree, we say ‘yes’, even when we can’t afford it, we say ‘io’ (iTaukei for yes)
Because this person is asking or because this family is asking, we cannot say “No”.
How do you get these people out of the cycle?
Talk to someone from HFC Bank or a reputable bank. Call me and I will make an appointment for you at the nearest HFC bank to you.
And tell them about all your debts and I mean all of the hire-purchase, the credit union, other banks and financial institutions.
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