‘Spending receipt’ halts expats loans

KUWAIT: Several banks have found confusing a number of instructions recently given by the Central Bank of Kuwait, pertaining with mandating bank clients who get consumer loans to provide receipts which prove how the loans were spent, sources said. The major problem about such condition is how to receive receipts from expats who get loans to spend them abroad, the sources explained. “The central bank left this point unclear in terms of who to hold accountable if an expat, for instance, provided fake receipts and documents about how the loan was spent,” stressed the sources, pointing out that, accordingly, some banks have become very meticulous about giving loans to be spent abroad, while others suspended such loans until things become clearer.

Notably, all banks ask expatriate clients to provide salary continuation and indemnity statement certificates to guarantee collecting the loans back from either clients or their employers. Furthermore, the sources said that both the Central Bank and local banks had met several times in the past without managing to decide who would be responsible for determining the validity of those receipts and bills. They also stressed that in case those documents were proven fake within six months from giving the loan, the concerned client, including those spending their loans locally, would be blacklisted. —Al-Anbaa