The majority of struggling credit and cash-advance cardholders have not responded to the government's offer of preferential treatment for those who applied to its bail-out program before today's deadline.
The preferential treatment includes exemption from interest charges during repayment negotiations and a ceasing of debt collection measures from banks.
As of last Monday, however, only 65,000 insolvent cardholders had applied for debt negotiation, or about 12.7 percent of the total.
Among them, more than 43,000 cases qualified for the debt-relief program, with total card debts amounting to NT$72.4 billion (US$2.2 billion), or NT$1.6 million per person, according to the commission's latest figures.
The government estimates there are about 510,000 cardholders in serious debt nationwide.
The card-debt negotiation mechanism was put into place by the Financial Supervisory Commission and the Bankers Association of the ROC (銀行公會) on Jan. 1.
The program integrates banking resources, allowing debtors to simply negotiate with their biggest banking creditors to hammer out a repayment plan rather than contacting each bank one by one.
Struggling cardholders can also enjoy reduced interest charges from zero percent to 12.88 percent -- depending on their individual financial situations -- upon signing a repayment contract with their banks.
Compared with the general revolving interest rate of nearly 20 percent charged by credit card issuers, the bailout schemes offered significant relief.
Most card abusers, however, seem to be waiting for the passage of a consumer debt clean-up bill, with many apparently believing that the legislation will exempt them from their liabilities.
However, according to the draft regulations the Judicial Yuan released on March 31, card abusers who apply for bankruptcy will be subject to numerous restrictions on daily life and employment, and those who are declared bankrupt will still have to make payments.
The draft states that cardholders who owe less than NT$10 million and are able to immediately return 20 percent of the amount outstanding would be given four to six years to repay their debts. They would need to make a payment at least once every three months during the repayment period.
Debtors who fail to pay off their outstanding loans within that period would be categorized as bankrupt for a seven-year period and be barred from taking 175 kinds of jobs, including futures traders, lawyers, owners of day care centers and from becoming members of farmers' or fishermen's associations.
Bankrupt individuals would also be barred from traveling abroad, or doing things such as taking taxis and eating expensive meals. Those who hide properties, transferring assets to others or living a luxurious lifestyle during the bankruptcy period could face detention, according to the draft.
The draft regulations are scheduled to be submitted to the legislature for approval in the middle of this month and would apply to around 100,000 people, Judicial Yuan Secretary-General Fan Kuang-chun (
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