Sunday, 4 March 2012

Ah Longs and Singapore’s social fabric

In the many years I have lived in Singapore, I never knew of 'loan sharking' to be as much of a problem as it is today. Newspapers carry news of the problem daily. Not one day passes without another sweep against loan sharks or their associates.
Far be it for me to suggest that the sudden proliferation of loan sharks can be directly attributed to the government's decision to legalize gambling 
Flyers from money lenders are now a common sight

Nevertheless, the recent rise of loan sharking raises many questions.
Why do Singaporeans suddenly feel the need to take out loans at prohibitive interest rates? Has the banking sector seized up and is unable to grant sufficient loans to keep the economy going? Have Singaporeans taken to entrepreneurialism so spectacularly that the need for funds is acute, such that the local 'Ah Long' is the only answer?

Undoubtedly, loan sharking is an emerging problem.

Loan sharking activities cannot simply be treated as a 'law and order' or administrative matter. Merely putting loan sharks and their colleagues in jail will not make the troubles go away. Jailed persons will simply be replaced.
Loan sharking is symptomatic of a wider social problem. There are reasons for the increased demand for high interest rate loans.
These reasons may include easy access to gambling facilities, i.e. casinos; many more licensed moneylenders operating on the island today – a case of supply creating its own demand. Or is a high cost of living squeezing Singapore's low and middle income segments so severely that loan sharks are necessary for survival.
These (and more) are valid questions. Singaporeans deserve an answer.
The authorities must consider forming an interagency commission comprising of social scientists, law enforcement officials and other experts to study the subject and make appropriate recommendations. Singapore's loan sharking problem is a symptom of deeper social issues plaguing 'New and Improved' Singapore. These issues must be dealt with in a holistic manner.
Imran is a business and management consultant. Through his work at Deodar Advisors, Imran improves the profitability of businesses operating in Singapore and the region. He can be reached at   

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