Against Repayment: Attac Maroc’s micro-loan petition.

‘For the end of micro-loan repayments’

Following is a petition shared by Attac Maroc, arguing for a six-month pause of micro-loan repayments and interest exemption.

Micro-financing began in Morocco in the mid-’90s. Sold as a developmental panacea – the leveraged poor would drive national growth – it was operated as ‘a regular for-profit financial sector with the capacity for manipulation and all-round market-driven ineffectiveness’, to quote Morvant-Roux & Moisseron’s 2018 essay . With international and state support through the later 1990s, Morocco was ‘considered for several years to be one of the most successful country experiences worldwide (…) the model pupil of an industry in the process of spectacular expansion.’ However, a repayment (‘delinquency’) crisis through the latter years of the 2000s saw the collapse of the sector-leading Zakoura Institute, and total borrowers fall from 1.2 million in 2007 to 800,000 in 2012, as defaulters and cross-borrowers were excluded – without though any generalised debt forgiveness.

By 2015 approximately US$5 billion had been lent, and 6.7 billion returned: ‘It is thus the poor who finance the micro-credit institutions’, as Attac Maroc wrote in their 2017 analysis. With the number of debtors having returned to pre-crisis levels, the sector is again facing mass delinquency, and thus the political question: who ought to pay – the creditor, or the indebted?

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Petition for the immediate suspension of micro-loan repayments for six months (renewable), with interest exempted. 

The state is now enacting measures announced by the Economic Monitoring Commitee in light of the likely consequence of the coronavirus catastrophe – measures that have not so far addressed the victims [ضحايا] of micro-loans. [1]

There are approximately one million debtors to micro-loan institutions in Morocco, comprised largely from the popular classes and low-income wage workers, half of whom are women. They borrow at interest rates rising above 30%, and face the threats of micro-loan institutions’ when they have difficulties with repayments, due to the instability of their work and living situation, and the reduction or even ceasing of their income. [2]

One result of the coronavirus catastrophe will be to deepen the crisis of both subsistence agriculture and small-scale projects [i.e., micro enterprises] – due to the loss of jobs and livelihoods, we should expect increased bankruptacies and the intensification of social and psychological issues of those suffering these micro-loans. This is at a time when they are struggling with increased costs of health protection, and in the shadow of the weakened public health sector. 

Moreover, the quarantine imposes the purchase of basic consumption goods at a time of increased cost-of-living, due to price liberalisation, the reduction of the compensation fund [the basic price-control facility], and the importation of the majority of food, in addition to the need to pay water and electricity bills, monthly rent, children’s education, et cetera.

We the undersigned demand that the Moroccan state enact:

– The immediate halting of monthly repayment of micro-loans for a period of six months (renewable), and exemption from all interest. 

– Lump-sum compensation, not less than the monthly minimum wage, for the benefit of micro-loans victims whose projects have gone bankrupt, or have lost their jobs due to the virus outbreak and health emergency.

Full name: 

National Identification number: 

Address: 

Occupation: 

Mobile Number: 

Email Address: 

Sign Petition:

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[1] The Comité de veille économique (or لجنة اليقظة الاقتصادية) – a new grouping. 

[2] ‘As a result [of lack of legal recourse against poor defaulters], the enforcement capacity of Micro-Credit Institutions in Morocco relies on non-legal actions against defaulters’, write Morvant-Roux & Moisseron. ‘This means in practice deploying such tactics as intimidation, pressure at home and even pressure at the workplace. Thus, late debtors were often harassed by phone and sometimes threatened with foreclosure. Sometimes teams composed of several people went to isolated douars (villages) to threaten debtors. According to our own observations in Ouarzazate, in an extreme case, a girl was seized by loan officers so as to force her parents to repay a microloan.’

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