Dubai: The Philippine government has warned Filipinos in the UAE against applying for loans and using credit cards that they can’t pay.
“This advisory is being issued in view of the alarming increase in the number of Filipinos detained due to unpaid loans,” an official from Manila’s Department of Foreign Affairs (DFA) said as reported by local media.
“Debt-related cases are extraordinarily difficult to handle, especially if the lenders, both banks and individuals, have filed criminal or civil cases against the borrowers,” the official added.
Philippine Ambassador to the UAE Grace Princesa said that the cases of Filipinos being stuck in debt traps are unfortunate. Although she has not received any official advisories from the Manila office yet, she advised her compatriots to refrain from getting into debt and instead strive to save.
“We have our ongoing financial literacy programme, which has now reached 2,500 Filipinos in the UAE. We will continue this advocacy and cascade the information to every Filipino, especially those in Dubai,” Princesa told Gulf News.
Atty Barney Almazar, a licensed UAE legal consultant and partner at Gulf Law who helps Filipinos with debt cases, said the advisory must have been issued in lieu of the holiday season in December last year. He said many Filipinos scheduled to fly home for Christmas were detained at immigration in Dubai due to debt-related cases filed against them.
“Many of them were unaware that the banks had already filed a case against them. And there were also those who were detained on their arrival not knowing that the banks had filed a case against them while they were away,” Almazar told Gulf News.
Almazar said he has since received at least one debt-related case per week. Roughly four in 10 of the cases they handle concerning Filipinos are debt-related.
“Part of the Philippine government’s warning said that they cannot help Filipinos when they get into trouble due to debt as it is a private matter between the lender and the borrower and the government cannot intervene using taxpayer’s money,” Almazar said.
“For them to issue such a warning means that the issue has reached an alarming state.”
The relative ease in getting credit cards and loans could be one of the reasons why Filipinos run into debt, Almazar said. Being ill-informed and irresponsible spending are also factors to consider.
Almazar said there are many options to stay informed and to stay out of debt. He invited Filipinos in Dubai to attend their financial literacy seminar on Friday (January 30) at 2.30pm at the consulate-general to know how financial woes can be avoided.
For those in Abu Dhabi, Princesa said a free financial literacy seminar will be held by popular speaker Bo Sanchez at St Joseph’s Cathedral on February 19.