Good Behavior Required To Get a Loan, Squatters Told

Good Behavior Required To Get a Loan, Squatters Told

Squatters who now want to borrow money from the Urban Poor Development Fund had better not drink alcohol or gamble, city officials warned Sunday.

“If they want to get a loan, they have to practice good behavior,” said Man Chheoun, chairman of the fund at City Hall. “If someone behaves badly, his family will not get a loan.”

But so far, only about 1 percent of those who borrow money under the program misbehave, said Chap Samoeun, officer in charge of community development for the loan fund.

In addition, he said, borrowers must present receipts to show that the money they received was used for the approved purpose.

The goal of the program is to help the city’s 170,000 squatters relocate from public property to land and homes of their own. Officials hope the program will teach borrowers how to save money and plan their economic futures.

Established in 1998 by the city and the UN Center for Human Settle­ment, the program provides loans of up to $400 per family. Families is required to pay 10 percent of the loan amount in ad­vance as a down payment.

Three months after receiving the loan, families begin to repay it at the rate of about $0.26 a day for five years. The total repayment is about $470 for a $400 loan.

The program, which has resettled more than 440 squatter families, ran into a snag recently when the bank where squatters’ down payments were deposited, the Agriculture and Commercial Bank, was shut down Dec 9 as part of the new banking law.

The city has written to the Council of Ministers and to the National Bank for help in releasing the bank’s money.

The National Bank has formed a committee to liquidate the bank’s assets.

If the bank does not have enough assets to repay depositors, the committee will ask the government for help.

 

 

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