Loan sharks and social safety nets

For those of us who are blessed with a job and a steady income, and have been living comfortably all our lives, it is unimaginable that people still resort to borrowing money from the so-called “Ah Longs” or the “loan sharks”.

We must all be horrified by the pictures shown in the papers about those defaulters being tied with dog chains and sit on the floor like dogs. No human should stand this type of indignity.

Many of those who borrow from loan sharks are habitual gamblers, and this group will resort to selling themselves if needed to. SO borrowing from loan sharks are no big deals to them, and they have no qualms to borrow from one to pay off the other, in the process, building up their borrowings. You may call this group ” tai se” or ” they deserve it”. ANyway, in my opinion, even this group does not deserve the punishments that the loan sharks meted to them when they default.

But there are some genuine poor who borrow because they have no choice. I have come across those who have borrowed to send their love ones to private hospitals, even though government hospitals would not cost them much money.

There are those who have lost their jobs and then they need to pay for their family’s lodging and food as well as their children’s education.

Many of these genuine poor are poorly educated, school dropouts, and they cannot speak Bahasa or English. They are too poor to get any help from the banks, which will only lend to those whom the banks consider low risks; there is a saying that “banks will only give umbrellas to those who don’t need them, and that they will never give you umbrellas during rainy days, when umbrellas are most needed”.

So for this group, they have really no choice but to borrow from Ah Longs.

Put yourselves in their shoes.

IMagine that you have no savings and earning a subsistence living from day to day jobs, and suddenly you need a relative big sum of money (to them a thousand maybe a big sum, even though a thousand to a rich person is nothing more than pocket money), let’s say you need the money to bury one of your loved ones, and no one you know will lend to you since most of them are as poor as you, some even poorer than the proverbial church mouse. What do you do? they resort to the easy way: Borrow from laon sharks.

There is in fact a big group out there who are termed  as urban poor. These are genuine poor who need help but help is not forth coming.

In fact, government should seriously consider setting up a mechanism whereby this group can be helped with certain form of vocational training or govenrment can set them up as petty traders to do smallbusiness after teaching them the basic knowhows.

IN a society, social safety net is very important. The fact that loan sharks exist say much about our social safety net system. Even more alarming is the rumours that these loan sharks may be linked to some politicians . (Politicians are supposed to find ways to tackle the ills of society and not to add ills to society. )

17 Comments (+add yours?)

  1. genesispassion
    Jun 02, 2009 @ 15:23:04

    objectively ah long is like drug..u cut at source not allowing it accessible to people in need…the problem we have is not ah long..its the economic structure..when a country is highly efficient and cost effective it create employment.when government policies are done rightly ..i dont see people will be jobless..the fingers should be at the government
    the general idea gamblers borrows from ah long is very generalized.
    i have few friends educated ah long..with tie ! coming to chinese new year, many business man have to settle payment… cash flow was bad..they resort to temporary loans for salaries payment for supply..it s a vicious circle..many of us in business will attest to that !

    ah long operation are not run without some police protection..my friend s tell me…care to comment ?

    Like

  2. klm
    Jun 02, 2009 @ 16:03:28

    Just look at the show put up by the police on trying to locate the ah longs. That shows you what is going on. Big firework. Want to find who the ah longs are. Heck. The police knows exactly who the taikos are. They even drink with them.

    Now the police are searching for them. Big Joke.

    Like

  3. klm
    Jun 02, 2009 @ 16:04:45

    I forgot to add. If the police dont know. Just ask Michael Chong.

    Like

  4. pilocarpine
    Jun 02, 2009 @ 16:33:31

    police on the vices payroll? something new?

    social safety net? isn’t there already one?
    the one, more reserved for people more ‘local’ than the others?

    “I have come across those who have borrowed to send their love ones to private hospitals, even though government hospitals would not cost them much money.” = no choice?

    Like

  5. pohwatchdog
    Jun 02, 2009 @ 17:32:42

    What we need is a better social net? Education is what we need to tackle this problems. What we are having a number of lottery draws per week created a number of social problems. Is it not time we need to look at the various gambling outlet? What we need is efficiency enforcement and not ad hoc? The media play a important role to create awareness.

    We need a social security net for those that really need financial help for medical needs and humanities.

    Like

  6. small bird
    Jun 02, 2009 @ 17:35:56

    Interesting news about Ah Long by RPK.

    Heavenly King: The Story of Kuala Lumpur’s Boss of Bosses

    Source:
    http://mt.m2day.org/2008/content/view/17980/84/

    Like

  7. small bird
    Jun 02, 2009 @ 17:59:04

    Another interesting news about Ah Long by RPK today:

    … Ah Longs are in partnership with the police so nothing was done about the problem. That’s right, you think the Ah Longs can operate if not for the fact they pay the police protection money?

    Source: http://mt.m2day.org/2008/content/view/22687/84/

    Like

  8. clearwater
    Jun 02, 2009 @ 18:02:21

    Licensed money lenders claim they provide a needed ‘lender of last resort’ service not otherwise available to desperate borrowers. It is the illegal ‘ah longs’ that are the bane of the money lending business with their indiscriminate lending to weak borrowers, exorbitant rates and strong arm recovery methods. They have mushroomed because the business is so lucrative. Gambling is big business in Malaysia and impacts many lives negatively. It can be said to be a contributory factor to the growth of the ah longs.

    In the old days, there were self help financing schemes among acquaintances known as ‘tontines’ where a group of people pooled their resources each month. This pool would be offered at auction where a needy member could bid for the pooled sum. He will then repay the sum plus interest monthly till the end of the scheme. It works if all members are honest and do not abscond. It is not legal but an interesting self help mechanism in many small communities. I wonder if this still exists or it has faded away because mutual trust is all but non-existent in our current society.

    Like

  9. Dr Hsu
    Jun 02, 2009 @ 20:23:16

    robertchai,

    I have inadvertently removed your latest comment. Sorry about that but I have retrieved the message from my email and i will post it here:

    It is time to reflect on our society. It is getting tough to survive in this global economic challenge. Even engineer, lawyer and business man having tough time to cope with this economic challenge. We need positive attitude to overcome this situation. Maybe our government can provide more incentive or tax rebate, cash handout through EPF contibutor and various suitable loan to help out needy Malaysians.

    Like

  10. Meng
    Jun 02, 2009 @ 22:26:40

    This problem, known a long time by the govt and no positive action taken. There should be some sort of regulation on the interest rate. Ah Longs are poor men or the needy businessman’s bank.

    The govt should make a law that all borrowings whether from individual or Ah Longs, the standard banking rate applies. It should be an offence to charge more than what the banks are charging…an offence with heavy sentence and fines as a deterrence. This should protect the poor and needy!!!!

    Like

  11. A true Malaysian
    Jun 02, 2009 @ 22:29:28

    MY FEAR

    With the rate of how are things happening in Malaysia, I fear to even think what would be happening for the next six months. Forget about for the next one, two years or next GE, that seems to far ahead.

    The sentiments of many of us are very low. Income, business, people’s confidence are on declining graph while costs of living, crime rate and insecurity keep increasing.

    I could guess from the comments in this forum are fast becoming a political forum especially from Gerakan and BN members. Each mainly touches on political tussles, how to win back people’s supports, how to attract youngsters to join in as members. What I can tell you here is that, your efforts through those activities described will not bare any fruit, simply because rakyat have lost their confidence in the belief system of Umno, Gerakan and the whole BN.

    Umno, Gerakan and the whole BN should in fact seriously think of how to gain back people’s confidence through sincere and substance ways like:-

    a) dissolve Perak Assembly & go for fresh elections

    b) abolish toll charges of all highway and expressway, after all, the government have lost so much in whatever scandals that we know of.

    c) stop interference with Judiciary, as its integrity and impartiality are seriously at stake

    d) practising open tenders for all government projects

    e) take steps to regain public confidence on our police force

    f) helping the poor through proper education

    g) put back meritocracy in all level of country’s system and all are subject to same set of standards.

    h) abolish all draconian Acts like ISA, Sedition Act, & etc.

    and the list goes on.

    We are actually facing with confidence crisis, and immediate remedial actions are necessary to restore this confidence. If present BN government cannot do it, perhaps it is better to go for a Snap GE once and for all, and from there work together in rebuilding economy. There is no point you use your power by all means to hang on this power granted to you by rakyat.

    Like

  12. graveyard
    Jun 03, 2009 @ 01:00:41

    Dr. Hsu,

    After HCG answered the show couse letter and still sit tight in his VP position and not resigning afte all, will your CWC suspend his membership??

    HCG have lost a lot of public support and the common people perception by his latest outburst about current Gerakan Leadeship and done a lot of demages to Gerakan…

    Will the CWC let him off lightly??

    graveyard vacant lot still waiting.

    graveyard

    Like

  13. Meng
    Jun 03, 2009 @ 01:47:56

    Did I hear any MCA or Gerakan leaders positive comments on the Ah Long and what action to take ????

    Don’t you think they ought to be jumping and call for more action against ah longs esp MCA who are supposed to look after the chinese welfare.
    The leaders of the various states should be making statement after statement calling for stern action, don’t you think so??

    Oh dumb shit mca and gerakan fear for their lives too…are they. No they also need the ah long networkers support…during election.

    Situation has got out of hand.

    Perhaps they are Ah Long themselves or share partners..can never say….Maybe dogs to ah long too.

    Like

  14. AY
    Jun 03, 2009 @ 17:22:35

    Dr Hsu,
    I agree that Ah Long also plays an important role in our society especially those genuine cases where people who are in dire need of funds.
    I heard on the radio that Michael Chong cannot understand why these people cannot borrow from friends and relatives. If it was so easy to borrow would people turn to Ah Longs when interest rate is high and risk endangering themselves and their family ?

    Like

  15. Atila
    Jun 04, 2009 @ 12:28:00

    DrHsu

    our yb had a keusahawan program recently.

    attended by about 80 kampung people, some have their own business some are thinking wat to do w their vr money some want to expand looking into how to get halal certification…

    then come the portion one bank after another
    speak of borrowings interest guarantors…
    this that…

    i now understand why people turb to ah long.

    Like

  16. tshock
    Jun 05, 2009 @ 02:00:17

    Dato’ Michael Chong, so called community service is just a farce when it comes to Ah Long cases. I know because I approached him for help to negotiate with the Ah Longs on my dues to them. His response to me was to add up what is my outstanding owing to the Ah Longs and get the money ready for him to “talk” with the Ah Longs. If I had the money I don’t need him to negotiate I will just pay them and get it over and done with.

    Assuming that I had the money and I pass the money to him to negotiate, I understand from some sources that he would “squeeze” the Ah Long to accept a lower settlement and then tell the debtor that what was negotiated was a higher amount. What happen
    I leave it to you to deduce.

    BTW, the money that I borrowed from these Ah Longs were to cover business operations.

    Like

  17. ellen leong
    Nov 12, 2014 @ 14:09:09

    MCA oledi dies yrs.ago. Just name Michael Chong to those who had seek his help to nego with alongs , his name stinks , those alongs who dunno him ,
    how can they operate. MCA , can be trusted , shit oso can be eaten. instead of helping fellow Malaysian esp. the Chinese , they gang up with alongs and squeeze blood out of stone frm. us.

    Like

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