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“National tragedy.” That is how Finance Minister Mangala Samaraweera described the problem of prevalent household indebtedness in Sri Lanka, when he recently announced the government’s decision to write off debt of LKR 1 lakh or less, incurred by 75,000 women in 12 drought-affected districts across the country.
The move, aimed at providing relief to those caught in a debt trap created by microfinance companies charging exorbitant interest rates, was inevitable. There were multiple protests by affected women in the island’s north and east, where debt, compounded by other post-war challenges, is acute.
The decision will cost the government LKR 1 billion (roughly $6.2 million) and there are few comparable efforts by any government in the region to take on the peculiar challenge that the once-celebrated microfinance schemes have thrown up.
Source : https://www.thehindu.com/todays-paper/tp-international/turning-the-spotlight-on-industries/article24606399.ece
