Kuwait City: Bank sources estimate that expats have entered into loans totaling 4 billion Kuwaiti dinars, reports Al Qabas.
Of the 4 billion, 3.4 billion were installment loans for housing purposes, compared to the 622 million Kuwaiti dinars in consumer loans.
According to the latest statistics from the Central Bank of Kuwait, the total amount of personal loans taken out in Kuwait reached 16.6 billion Kuwaiti dinars. The majority of the personal loans were borrowed by Kuwaiti, as expats took out 24 percent of the total borrowed amount.
A source told Al Qabas that a recent study showed that 40 percent of the total consumer loans in the country were taken out by expats, while the other 60 percent were accepted by Kuwaiti.
In terms of home loans, Kuwait has the most loans, about 72 percent, compared to expats who took out 28 percent.
The source added that the banks have strict rules, and therefore they carefully choose to whom they can give loans. The majority of banks prefer to lend to non-Kuwaiti working in the public sector and in large enterprises, as their salaries are likely to be guaranteed.
In addition, the lending policy differs from bank to bank, and some banks have a limit on the total percentage of loans they give to expats, while some set the limit at 20 percent, while otherwise it stands at 10 percent.
Unpaid loans by expats
Although many expats have started leaving Kuwait due to expired visas, some banks have begun the process of prosecuting those with unpaid loans, Al Rai reports.
A source told Al Rai: ‘The loans taken out by expats are not abandoned if their residences expire and some banks have started pursuing complaints abroad and their guarantors at home, with the help of debt collection companies. ‘
The source explained that the “weight of money borrowed does not constitute a massive amount in terms of value, as the loan ceiling is specific to the majority of expats, often focused on consumer spending, which determines conditions based on salaries. . “
The majority of those who have defaulted on their loans are individuals working as education, engineering and medical staff.
Source: Gulf News