Saturday, May 15, 2010

Diving into Debt

Published  May 11, 2010 - Muscat Daily

A few weeks ago, I received a frantic call from one of my colleagues asking me to come and pick her up at her bank immediately. Without asking any questions, I got into my car and drove to her rescue. She came out of the bank clutching a large envelope, got into my car and asked me to take her home. I asked her what was in the envelope and she opened it to show me bundles of 50 rial notes! I must have fainted momentarily, because she tapped me on the side of the head and said 'Drive!' And this is how I drove across Salalah with thirty thousand rials in my car. I felt like I'd just robbed a bank.
You may be wondering what the money was for. Well, so was I! Evidently, she had decided out of the blue to buy her dream car. She got the cash without any complications, through a personal bank loan, since she is too young to get that much through a car loan program. This girl is a recent college graduate, is in her very early twenties and has only been working for some months. It's going to take her ten years to pay off that loan. Is it just me, or do you also find that frightening?
 It's no secret that a large percentage of young Omanis, now both male and female, in their twenties and early thirties are living way beyond their means and are refusing to accept a standard of living that suits their income level. Many take loans to support their families, but a large percentage of them (like my happy or perhaps hapless colleague) decide to go into debt for a car. Car loans, bank loans, personal loans, misuse of credit cards. What next? Among the factors contributing to this phenomenon are the rise of consumerism in Oman, an increase in the cost of living, and the need to keep up 'appearances', especially in Salalah. With mobile phones and cars emerging as fashion statements and lifestyle necessities in the Gulf, the pressure to spend is on.
A recent survey revealed that the spending habits of youth in the GCC are such that more than a quarter of the respondents admitted that they were in debt. More shocking were the figures from Oman. Evidently, thirty five percent of youth between the ages of 18 - 24 in Oman claimed to have loans. Thirty one percent of them had personal non-business related loans. The culture of credit cards shoulders much of the blame. The survey found that the main concern among young people is the rising cost of living in the region. To keep up their lifestyles, they have to spend more money, and in turn, take on more debt.
The concept of living within one's means and earning something after hard work is lost to many young people (and older people obviously) in Oman. Most of my friends are buying cars on credit. And these aren't just any cars. The majority cost between 16,000-30,000 rials. How is a person in their mid-twenties going to come up with that kind of money? What makes them think they need that kind of car when they haven't earned it? The only thing worth going into debt for, in my opinion, is higher education. Anything else can pretty much wait.
 Whatever happened to the concept of starting small and working towards your materialistic goals slowly? Young Omanis should be able to see the fine line between what's 'necessary', and what's 'luxury'. This is not how we humans are meant to live. Banks shouldn't make it so easy for young people to be given loans on a silver platter. Unfortunately, though, we can't blame only the banks. With debt becoming an increasingly significant and not so positive issue in Oman, due to changing lifestyles, I don't think it's going to get any better in the near future unless people become more aware of the dangers of living beyond their means. Someone please start a campaign to educate our children on the dangers of debt before they even leave school! If we can scare them into not smoking, surely we can convince them that getting into debt is equally, if not more dangerous.


  1. Bang on young lady. you really did hammer a great truth. I think I speak for alot of people when I say that Banking system here in Oman needs to be changed to set a proper age condition for borrowing money. With that have been said, educating the young ones is very necessary, for them to know the consequences of being in debt. Thanks Susan, you really are a great writer. Please keep more useful things comming.

  2. Nice blog. I think a lot of people are living like this. The economy isn't helping. But, I think that it's mostly living out of our means. My mom always said, stop trying to live like the jones next door. If everyone was happy with a family car and a simple life, this world wouldn't be a mess like it is. ITA ... If it's not cash, we don't buy it.

  3. Nice post suz... sometimes ppl are enforced to take a bank loan for a car, not a fancy but a car which has 4 wheels, break, a staring :)...

  4. As salam alaikum sweety,

    Grt artical yet again..bravo!!
    I feel someone is on the same page as me about this topic of loans and way of life. You said it so accuratly when you said "the need to keep up 'appearances" because thats what is happening from what i can see from my 2 years of living in the salalah society and then 20 odd more years living in khaleej.
    I look around at people our age, most have bank loans and paying haram interest on them, which boils my blood ufoo..then you got older siblings who are in debt taking loans on other siblings visa cards and not paying them back. And the car business that one has to have the bes car out there because mohd, jack and jones has such and such a car is a real joke.
    I thank Allah i have no debt in any bank. I honestly know the only people im in debt to is my parents for thier providing of a private education all my life and feeding us with wholesome food.

    The sooner we take a stand and address the issues in society inshaAllah the sooner the youth will come to realise life is not about " the jones" syndrome.

    Debt stays in its grave where it belongs.