The Department of Foreign Affairs issued a reminder and a warning to Filipino workers based in the United Arab Emirates against obtaining loans and using credit cards in the foreign land.
“This advisory is being issued in view of the alarming increase in the number of Filipinos detained due to unpaid loans,” the DFA said.
The DFA said the due to low interest rate loans OFWs tend to apply for various loans and then find out they did not read the fine print – some taking as much as 18 months of salary to pay them back.
“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 DFA explained.
It added, “Once a civil case has been filed against a delinquent borrower, a travel ban is automatically imposed against the borrower and he or she would be unable to leave the country”.
Likewise, issuing a bounced check is a criminal offense in the UAE. Lenders usually require borrowers to affix his or her signature on a blank check as a security measure. When the borrower defaults on his or her obligation, the check will bounce and criminal charges would ensue. If the signature on the check is proven original and authentic, the case against the borrower is upheld in court.
“For instance, two Filipinos had difficulty in leaving Dubai due to unpaid loans. One was stuck in Dubai for 14 years after he defaulted on his bank loan worth AED80,000 or US$21,700, while another was stuck in Dubai for several years after the lender, an Indian national, filed a case against her for non-payment of a personal loan,” the DFA cited.
Loans are considered as private matter between the lender and the borrower and Philippine diplomatic missions cannot intervene in these cases, the DFA clarified.
“The OFWs are encouraged to be wise in spending and saving their hard-earned money to avoid incurring loans from banks and private individuals,” the DFA noted.