Jordan’s Criminalization of Poverty Is Imprisoning Thousands

Published March 17th, 2021 - 10:24 GMT
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A prison in Zarqa, Jordan (AFP/GETTY/FILE)
Microfinancing is criminalizing poverty in Jordan.

According to a recently published Human Rights Watch (HRW) report, tens of thousands of Jordanians are currently at risk of imprisonment for failing to repay loans.

According to those HRW spoke to, sometimes several members from the same immediate family are at risk of imprisonment. Microfinancing is behind a large proportion of those in debt.

The recent economic downturn, spurred by the coronavirus pandemic, has seen the number of people at risk rise exponentially. “According to a 2020 study by Jordan’s Economic and Social Council, the number of individuals wanted for failure to repay debt rose tenfold in only four years, from 4,352 in 2015 to 43,624 in 2019,” the HRW report details. 

Debtors make up around 16% of Jordan’s prison population. In March 2020, the government delayed the imprisonment of around 3,000 people to avoid overcrowding during the coronavirus outbreak. Those convicted can face up to 90 days in prison per debt and up to one year for a bounced check. Upon release, people still have to pay the original amount to lenders. 

 

The number of individuals wanted for failure to repay debt rose tenfold in only four years, from 4,352 in 2015 to 43,624 in 2019.

 

Microfinancing - a financial instrument designed to provide injections of capital to poor individuals - is a driver behind the increasing number at risk of being locked up for being poor in Jordan.

The brainchild of Nobel Laureate Muhammad Yunus, microfinancing began in the 1970s as a way of alleviating poverty without relying on charity. The idea was to provide cash to people on very low income or unemployed people. It entered the Middle East in the 1990s and became important for those who wouldn’t normally meet the requirements for bank loans. Women, in particular, began to take out loans, mainly to start small businesses. 

 

The focus of the loans means that women have been particularly affected by debt.

 

However, hundreds of unregulated enterprises are operating with little or no oversight and are thriving in Jordan. “They mainly register as companies, non-profit organizations or even charities. Instead of supporting home-based businesses, they act like A.T.M. machines – a quick way for poor women to get cash to pay rent,” a report by Konrad-Adenauer-Stiftung said. “Unlike A.T.M. machines though, microloans attract an interest rate ranging from 22 percent to 50 percent per loan - and in addition, in some cases, a so-called processing fee.”

Problems with microfinancing in Jordan are not new. Jordan has been receiving funds from foreign governments and non-governmental organizations which have gone towards providing capital to poor communities through microfinancing since at least 2012. Even in the early years of the programs, women were arguing that their individual cases had not been properly assessed. Some said they were given too little to support their businesses, while others were given much more. 

The focus of the loans means that women have been particularly affected by debt. According to a report from January 2020, approximately 9,000 women are wanted for failure to repay debts that do not exceed $1,400 each. 

“It’s irresponsible to give a loan to somebody who doesn’t know the consequences,” Sara Ferrer Olivella, the United Nations Development Program director in Jordan told the New York Times last year. “It’s like giving someone an injection, and they don’t know what the side effects will be.”
 


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