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15-10-2013, 12:00 PM
An honorable member of the Coffee Shop Has Just Posted the Following:
Household debt
Our Archilles’ heel
Wealthy, yes, but Singaporeans are also among the most indebted people in Asia. By Seah Chiang Nee
Oct 12, 2013
(Synopsis: Pawnshop boom in a super-rich city; they are even listed in the stock market.)
WOULD you start a pawnshop in one of the world’s richest cities?
In Singapore, where household wealth is ranked second highest in Asia, not only has a company done so profitably well, but it has also been listed in the stock exchange.
It became Singapore’s first pawnbroker opened for trading every day.
“We plan to open several more,” announced Maxi-Cash, which has 29 outlets scattered over the island.
For some Singaporeans, the official recognition given to this business bank has come as a surprise. It is the sort that thrives on the back of people’s financial woes, a symbol of rising stress in the home.
Soon after, a second pawn group was also listed for a good business reason.
Pawnshop loans rose from S$2.7bil to S$4.9bil within a year to 2012.
The number of shops in**creased 62% since the opening of two casinos in 2008 – from 114 to 185 in 2012.
There’s a dubious consolation, though. This poor man’s bank may be better than the illegal loan shark, which charges massive interest rates.
“All this is crazy talk. I thought we are one of the richest countries in the world,” said a retired teacher.
While Singaporeans are relatively rich (helped by wealthy foreigners), they are also among the most indebted people in Asia.
Legal moneylenders or credit loan shops have also been sprouting up in the heartlands, dishing out fast loans.
Borrowers with no assets are forced to turn to loan sharks – an unlawful institution that has survived a long history of raids and arrests.
In the past four years, there were some 65,000 cases.
One surfer commented: “We’ve wiped off armed robberies, rioting and kidnapping; yet it’s baffling why they can’t seem to get a handle on the loan sharks.”
Even excluding the shadow banking, Singapore’s household debt through the official channels like banks are already ranked among the highest in Asia.
A StanChart survey recently released said it amounted to 151% of their annual income, the highest in the region.
Household debt now accounts for 75% of gross domestic product, having doubled in the last 13 years.
An economist called it Singapore’s “Archilles’ heel”.
Why are debts rising? Gambling is not the main contributor.
That privilege goes to expensive property and cars, as well as job dislocation due to mass immigration.
Fundamentally, Singapore is one of the 10 most expensive cities in the world, with many middle-class wages failing to keep up.
In an attempt to rein it in, the government recently adopted restrictive measures, including:
** Barring financial institutions from granting loans (particularly for property and cars) where monthly repayments exceed 60% of household income;
** Requiring banks to review a borrower’s total debt and credit limit before granting a new credit card; and
** Disallowing financial institutions to grant further unsecured credit to individuals who have outstanding debt of more than 60 days with the institution.
The new pawnshop trend has come to reflect a sort of decay in society, according to analysts.
“It is similar to termites eating a wooden pillar, done from the inside; you see nothing on the surface until it is too late,” said prominent writer Lucky Tan.
This was first published in The Star).
Click here to view the whole thread at www.sammyboy.com (http://www.sammyboy.com/showthread.php?166053-Stats-state-that-sinkees-are-rich-but-reality-is-that-we-are-poor&goto=newpost).
Household debt
Our Archilles’ heel
Wealthy, yes, but Singaporeans are also among the most indebted people in Asia. By Seah Chiang Nee
Oct 12, 2013
(Synopsis: Pawnshop boom in a super-rich city; they are even listed in the stock market.)
WOULD you start a pawnshop in one of the world’s richest cities?
In Singapore, where household wealth is ranked second highest in Asia, not only has a company done so profitably well, but it has also been listed in the stock exchange.
It became Singapore’s first pawnbroker opened for trading every day.
“We plan to open several more,” announced Maxi-Cash, which has 29 outlets scattered over the island.
For some Singaporeans, the official recognition given to this business bank has come as a surprise. It is the sort that thrives on the back of people’s financial woes, a symbol of rising stress in the home.
Soon after, a second pawn group was also listed for a good business reason.
Pawnshop loans rose from S$2.7bil to S$4.9bil within a year to 2012.
The number of shops in**creased 62% since the opening of two casinos in 2008 – from 114 to 185 in 2012.
There’s a dubious consolation, though. This poor man’s bank may be better than the illegal loan shark, which charges massive interest rates.
“All this is crazy talk. I thought we are one of the richest countries in the world,” said a retired teacher.
While Singaporeans are relatively rich (helped by wealthy foreigners), they are also among the most indebted people in Asia.
Legal moneylenders or credit loan shops have also been sprouting up in the heartlands, dishing out fast loans.
Borrowers with no assets are forced to turn to loan sharks – an unlawful institution that has survived a long history of raids and arrests.
In the past four years, there were some 65,000 cases.
One surfer commented: “We’ve wiped off armed robberies, rioting and kidnapping; yet it’s baffling why they can’t seem to get a handle on the loan sharks.”
Even excluding the shadow banking, Singapore’s household debt through the official channels like banks are already ranked among the highest in Asia.
A StanChart survey recently released said it amounted to 151% of their annual income, the highest in the region.
Household debt now accounts for 75% of gross domestic product, having doubled in the last 13 years.
An economist called it Singapore’s “Archilles’ heel”.
Why are debts rising? Gambling is not the main contributor.
That privilege goes to expensive property and cars, as well as job dislocation due to mass immigration.
Fundamentally, Singapore is one of the 10 most expensive cities in the world, with many middle-class wages failing to keep up.
In an attempt to rein it in, the government recently adopted restrictive measures, including:
** Barring financial institutions from granting loans (particularly for property and cars) where monthly repayments exceed 60% of household income;
** Requiring banks to review a borrower’s total debt and credit limit before granting a new credit card; and
** Disallowing financial institutions to grant further unsecured credit to individuals who have outstanding debt of more than 60 days with the institution.
The new pawnshop trend has come to reflect a sort of decay in society, according to analysts.
“It is similar to termites eating a wooden pillar, done from the inside; you see nothing on the surface until it is too late,” said prominent writer Lucky Tan.
This was first published in The Star).
Click here to view the whole thread at www.sammyboy.com (http://www.sammyboy.com/showthread.php?166053-Stats-state-that-sinkees-are-rich-but-reality-is-that-we-are-poor&goto=newpost).