Dear Mr Tan,
Please help to share this sad story in your blog.
Please help to share this sad story in your blog.
Bob (not his real name) is now 51 years old, a local Singaporean Chinese. Less than 6 six years ago, he married a young Vietnamese lady through a marriage agency. She was in her early 20s and he was then 45 years old.
Today, he is in debt partly due to his gambling habits and partly due to his generous care of his young wife by providing for her immediate family in rural Vietnam, inclusive of building a family house for them. He also gave a significant portion of his net monthly income as allowance to his wife and paid for multiple trips for her and her mother to visit Singapore. Bob is not rich, just a typical heartland Singaporean with gross income slightly above $3,000 but he has a fully paid HDB flat fund through CPF through his years of hard work.
Bob owes at least six banks through easy credit scheme and cash advance from his stack of credit cards to the tune of $80,000. This debt amount was accrued during the past nine months due to his casino gambling trips. Recently, he even turned to another four "licensed" money lenders to loan for a smaller sum. This easy cash loan is directly deposited into bank account and accordingly to Bob, most of them don't have a shop or office front and there is no formal loan agreement, just through handphone conversations and SMS texts and weekly debt servicing payment also through ATM to a designated account given to him.
Looking into Bob's debt issues, is there anything an individual could learn? Also, is there anything that our MAS could have done better to control easy credit card applications and approval?
In this case, if an individual earns only a gross monthly income of $3200, can he owns so many credit cards that allows him to have such easy cash advance to the tune of two months of annual salary for each credit card in his hand? Also, Bob has to pay a weekly 5% interest rate (i.e. annualized rate of 260%). Is there no guidelines in which MAS can impose upon such of debt which many licensed money lender operation to control the max? Bank typically impose a 2% interest rate per month (annualized rate of 24%) for credit cards loan. I have not even mentioned about one last category of dangerous debt which many are exposed to i.e. loan sharks.
One just need to walk into the numerous counselling sessions that are held all over the island to understand the full extent of the debt and loan issues which both Singaporean and non-Singaporean of all races are been traumatized. Bob now has to sell his HDB flat so that he can pay off his debts and he is also in the midst of a divorce proceeding initiated by his wife. He couldn't avoid to hire his own lawyer, but yet agreed to pay for his wife's lawyer for this uncontested divorce.
11 comments:
Well, I have no sympathy for bob. He is a gambler and he want to act yaya papaya by spending more he earns. Who is going to fund his high expenses especially the gambling bit. I don't blame the wife divorcing him as she was a young girl and still young may be below 30. She obviously married him to be look after and not his good look or charm as he is older to be his father.
She can remarry though not easy but still better to be dragged all the way down by his gambling habit.
Sounds to me that this guy has a gambling problem, and all the talk about his debts, high interest charged, vietnam wife and divorce problems are the consequences.
This guy earns $3,200 and can run up 6 credit card debts. Even if the govt is to outlaw credit cards, how do one ensure that he won't borrow from a loan shark? And in the meantime, someone else who is a responsible person earning $3,200 cannot get a credit card?
Bob should take personal responsibility for his own situation. The State surely cannot have 100% fool proof regulations to protect every single singaporean from their irresponsibility or stupidity.
Guess Bob wanted to show off to his young wife and her family that he could afford to support them, and when his salary fell short, he took on credit card loans, borrowed from legal moneylenders, and maybe loansharks, to maintain the facade of keeping face. Finally trying his luck at the casinos to get extra money, eventually lost and got deeper into debt.
You need plenty of dough to impress a woman, whether local or foreign, can't afford, just dun act macho, come out clean right from the start. May not get his young nymph, but at least dun get saddled with money woes.
Quite a typical story told countless times with older men and young foreign wives.
Bob's friend, who sent the story to me, is asking for control over the interest rate charged by credit cards and licensed money lenders. Stronger measures can be taken against the illegal loan sharks as well.
There are many people in the same shoes as Bob. They are not able to find a local wife, and has to look towards foreign wives. They are also not financially savvy. They do not have access to financial counselling, until things become very bad.
We cannot just say - let them face the responsibility. The government can set some rules that can reduce the financial hardship; rather than let them face the harsh realities of the market and its exploitation.
What is the Government for? I do not expect the Government to solve all problems, but they do have a duty to set the framework for the society to operate more smoothly, for people like Bob.
Agree
Absolutely agree.
Our parents were also not "financially savvy" and "financial counseling" didn't exist. But they knew how to live within their means and they understood responsibility. if the government limits people to only one credit card, some of us will protest because we want different cards for different benefits and we use them accordingly. Ultimately, nobody can protect people from their own stupidity and irresponsibility. This is probably a bad case study to use for your purposes. If "Bob" had lost his job, or his family had a medical contingency, or something beyond his personal failings, we would all be more sympathetic.
Yup. Why are men so hung up about impressing women? Don't they realize that if a woman wants to marry you only because of what you can give, it is not a sustainable relationship? Regardless of how rich you think you are, things can always change. Just two words for people like Bob: get real.
Bob's friend sent this email to me.
Dear Mr Tan,
I have read the 4 comments posted and also your very objective responses. You have correctly put the whole issue into a proper perspective. Thank you.
This is not to appeal for pity for Bob's lack of spending control and also his mistake to borrow heavily from both banks and money lender to lose them all at the casino.
Bob kept sharing with his siblings that he pity his wife as she is from the poor rural area. His heart is too soft.
I don't blame those folks for making such negative comments because they don't know the actual background of Bob and his financial woes.
Before his marriage, he has never walk into any casino or gambling dens. His debt was accumulated only during the past nine months of this year. He doesn't gamble on horses but do buy 4D and play mahjong.
Maybe the way I phrase it into the narrative with the words "debt partly due to his gambling habits ......." make people mistaken that Bob is a hard core gambler, which is not the case.
His wife is pressing him for a divorce as she now felt that he is too old, too ugly and don't have money! We suspect that she has a younger boy friend outside as Bob accidentally spotted the younger man photo on her handphone.
Bob can't "afford" to hire his own lawyer (I mistype in my narrative in last paragraph using the wrong word "avoid" instead of "afford"), but yet paid for his wife's lawyer fee.
Since this is a uncontested divorce, he decides not to hire his own lawyers. His wife is pressing for a one lump sum alimony instead of monthly payments.
Bob thinks he can settle all debt, including the one lump sum alimony settlement, by selling off his current HDB flat. He is now seeking help through a non profit counselling service and also signed up for the two hours "info" session through CCS before he has a chance to meet up with a CCS counsellor (need to queue up for 4 to 6 weeks!) to help him to re-structure his debts from those six or seven banks.
It is not good to include too much of such personal details into the narrative.
We need to focus on the wider framework of what our government can do to all those so called "licensed" money lenders with super high interest rate that is no different from those
loan sharks!. Also, having ownership to a stack of credit cards for a person earning just $3200 and having easy cash access to two months salary per card is totally incomprehensible
to me.
We need to set the framework for society to operate more smoothly, not just for Bob and for many people who are not financially savvy or don't have access to financial counselling until things become very bad, as you have mentioned.
Conversation between money lender (ML)and borrower (B):
B: I need about $2000, can?
ML: OK. interest is 25% and if you miss any payments, we will increase the rates.. you understand?
B: Ok, lor.. but I have outstanding amount with another lender.. you ok with that?
ML: Not my problem. As long as you pay me, you handle your own issues..Give me your IC..
Conversation with bank credit card officer (Bank) and applicant (A):
A: I would like to apply for a credit card
Bank: OK! may I have your pay slip or IR8A?
A: Yes, here it is. Would it be a problem if I already have another card with another bank?
Bank: No problem sir! we will issue the card based on your IR8A or payslip.
A: Ok! thank you!.. errr,, do I get the free $50 voucher?
Bank: Yes! certainly!
Questions:
Who is morally right or wrong?
Who is responsible for which action?
What needs to be regulated?
What use is the regulation?
Who should enforce it?
How should it be enforced?
It is unfortunate that 'bob' has to sell his only home, lose a wife and incur more monetary losses.
I hope he learns from his personal experience. As for others that may follow his footsteps, they too will have to learn their own painful and personal learning.
I do not see it as society's duty to rehabilitate. It is a jungle we all live in. To survive in it, the tools have been issued. This was done by parents, relatives and friends. It was issued through time.
So by the time 'bob' is old enough and if he has not acquired skills to use the tools of survival.. what do we need to do, just for him and others like him?
"What is the Government for? I do not expect the Government to solve all problems, but they do have a duty to set the framework for the society to operate more smoothly, for people like Bob." - Mr. Tan
Fully agree, sir. I've sent my feedback to MAS, hope they take it seriously. Then again, I don't have high hopes.
It's horrid that you didn't win the presidential election last year. You could have pushed for greater measures to protect us citizens since you have a track record of doing so.
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