The National Assembly’s financial and economic affairs committee and the government yesterday finalized a deal that requires the government to waive hundreds of millions of dinars in interest on the loans taken by Kuwaiti citizens, the head of the panel said. MP Youssef Al-Zalzalah that according to the final formula, which is expected to be passed as legislation by the Assembly tomorrow, a special fund called the family fund will be established by the government.
The fund will purchase all outstanding loans taken by Kuwaitis in the period between Jan 1, 2002 and March 30, 2008, waive all existing interest on them and reschedule the repayment in easy instalments not exceeding 40 percent of the debtors’ income. Zalzalah said that based on the final agreement, the deal will cover those who took loans from conventional as well as Islamic banks and financial companies in that period. Debtors who are under the government’s defaulters fund, established in 2009, can also benefit from the new debt relief scheme. There is no mention of expatriate debtors benefitting from the bailout.
The agreement was struck despite criticism by various quarters including several MPs because they did not think that the settlement is fair or comprehensive. The bankers union also slammed the deal, saying it will only marginally benefit Kuwaiti debtors and claimed it is designed to mainly benefit banks.
Read more: http://news.kuwaittimes.net/2013/03/18/govt-to-set-up-family-fund-as-debt-deal-to-become-law-foreign-relations-panel-discusses-border-with-iraq/
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