Joachim Buwembo
31 August 2008
opinion
As we race deeper into the twenty-first century, the diseases associated with modern living are increasing in Kampala and other urban areas of Uganda.
With more people joining the so-called middle class and leading a sedentary lifestyle, heart problems are on the rise and words like cholesterol have entered everyday language.
Diabetes, high blood pressure and gout are no longer rare, and the same applies to certain cancers associated with consumption of certain substances.
Meanwhile, depression and stress are also becoming common, and matters are not helped by lack of professional help in the field of psychiatry in which hardly any investment has been made by way of infrastructure and skills development.
There is also another "new" disease afflicting the middle class and it is called debt.
The strange thing with the new debt strain is that it does not affect the poor as much as it attacks the rich, or those believed to be rich.
But unlike the diseases of the mind for which the society has not been well prepared, institutions to deal with the debt disease seem to be well developed and afflicted people are immediately and effectively dealt with.
The two most prominent of these institutions are the Commercial Division of the High Court and Luzira Maximum Security Prison.
In just the second last week of August, four prominent Ugandans were admitted to Luzira prison after being diagnosed with debt.
These were the publicised cases because of the prominence of the persons involved, but there must have been others who are only known to their families, and their angry creditors of course.
Every disease has a cause and Kampala debt is not an exception. In fact it has several causes but the commonest vector that transmits it is the car. One banker swears that for every other big four wheel drive vehicle on Kampala's streets, there is a candidate for admission to Luzira with acute debt.
MANY PEOPLE WHO WERE DEBT FREE entered the trap when they started prospering, and someone offered them a big car on loan allegedly to enhance their image to befit their new status.
Or they imported one and then the problem of paying taxes set in. It really shows how fragile our businesses and personal economies can be. For a promising businessman to go under because of a car is really a sorry story, albeit a common one.
Besides promising businessmen who acquire the debt syndrome when they are persuaded to get lured into buying big cars they can hardly afford, another high risk group are newly employed people.
These get persuaded by fast talking banks sales persons who offer them easy credit. But please quickly note that the word "easy" refers only to getting the loan, not paying it.
Once the newly employed person gets his loan, he discovers after only a month how tough repayment can be. The interest rates for these salary loans is not low, at about 25 per cent.
So even after paying for one year, the borrower finds that they have reduced the total balance by very little. And there is no guarantee that the person will remain in the same employment for long.
That is where the real problems begin. Employers got out of the business of giving loans and advances to their workers and passed this on to the banks.
The common phrase was that "lending is not our core business" and the banks took over. But the employer does not guarantee the loan, they just introduce the employee to the bank and undertake to pay their salary through the lender bank.
Period. So the day the borrower is fired from the job, the banks have to get quite ruthless or else they stand to lose. The resale value of the car in question has meanwhile plummeted to half of what it was bought for.
And thus at the age of twenty-something, many a young Ugandan are joining the list of hunted debtors.
It is at that stage that they ask about the considerable sum they paid for insuring the loan, and they are told the insurance covered only death or 75 per cent disability. But if a person is to be admitted to Luzira, doesn't it amount to more than 75 per cent disability?
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