DUBAI: A Filipina housemaid, 39, who asked for her name to be changed and was referred as Angelina Cruz by The National, has amassed a Dh12,000 debt to two loan sharks and is barely managing to pay the 15 percent interest charge each month, equivalent to an annual rate of 180 percent.
“I have been paying already for nearly a year,” the mother-of-three who has lived in the UAE for seven years reportedly said. “I just need to do something, otherwise even if I work for 10 years I won’t be able to pay it off because it will keep going up.”
She is not alone in the UAE. According to the Al Etihad Credit Bureau, 3.15 million UAE residents (almost one in three) are living in debt, and almost all of them have more than one loan, the Abu Dhabi-based newspaper report said.
Cruz’s money troubles started in 2013 when she left her employer, for whom she worked for four years, it added.
She reportedly secured another job, but left after two weeks as she did not like the family. It took her two months to find another employer, during which time her expenses piled up.
“I am a single mum. I am separated from my husband. So I don’t have anyone to help me financially because we were also renting a house in the Philippines at that time,” she was quoted as saying.
“I asked my friend if she knew someone I could borrow money from, because I can’t take a loan from the bank. I have only a Dh2,500 salary in my job [and] need at least Dh5,000 and then a salary certificate for three months and a bank account [ to get a loan from a bank].”
A friend arranged for her to borrow money from a gentleman Cruz has never met, acting as an intermediary and guarantor for the loan, the report said.
She initially borrowed Dh2,000 and was making the Dh300 repayment each month, but after borrowing about Dh2,000 more she soon ran into trouble because of family problems and could not cover the increasing instalments. As a consequence, each time she missed an instalment it was added to the principal loan amount, it was pointed out.
She now owes Dh7,000 to the original lender and Dh5,000 to her “friend”, the guarantor, for missed payments on the original loan – in total three times the amount she borrowed. And she has already been paying the loan back for a year, The National reported.
“I don’t want to have a problem with them, for them to give me any trouble, especially with my employer. So sometimes I borrow from others so I can pay the interest,” she reportedly said.
Cruz and her son, who together earn Dh4,700 a month, have to pay Dh1,800 a month just to cover the interest on the loans. And if they do not pay, the guarantor for the original loan withdraws the interest payment each month from the ATM card of Cruz’s son.
“We are paying Dh1,300 for the bed space, and with the transportation and food we can’t really send money back home and I am feeling bad for my [two] children back home because they are suffering,” Cruz was quoted as saying by The National.
“Most of my friends tell me to report them to the police, but I know they have a family back home to support. I don’t know where to turn. I can’t sleep at night.”