A series of complementary bailout measures should be implemented to solve the snowballing social problem of credit and cash card debt, a consumer advocacy group said yesterday.
Currently, the nation's estimated 500,000 to 700,000 "card abusers" can make use of the card-debt negotiation mechanism, put in place by the Financial Supervisory Commission and the Bankers Association of the ROC (銀行公會), with several lower interest-rate payback programs available for those heavily in debt.
From Jan. 1 to March 1, the mechanism received more than 14,000 applications, in which 8,773 cases were qualified for debt negotiations and 7,323 cases reached an agreement on a payback plan, representing a success rate of 80 percent, the commission said last week.
However, only a small percentage of the nation's debtors have been helped, according to the Consumers' Foundation (
"Police figures show that, every month, more than 40 people nationwide commit suicide due to their escalating debts," said Consumers' Foundation chairman Jason Lee (
"Of course debtors are obliged to pay back the money they owe. But we must give them a chance by offering better-designed [repayment] mechanisms," he said.
The foundation suggested that the card-debt negotiation mechanism lower its thresholds to encourage more debtors to submit applications.
In order to offer a "one-stop service," the Bankers Association plans to set up a permanent committee in May to take charge of the card-debt negotiation mechanism, which is currently operated by the nation's eight major banks.
The Consumers' Foundation suggested that the committee invite members of the Consumer Protection Commission and consumer advocacy groups to participate.
In addition, relying on a single relief plan is by no means sufficient, Lee said.
Lee cited the existence of support bodies in the US, such as the Consumer Credit Counseling Service, which was set up to provide budget counseling, educational programs, debt management assistance and housing counseling, and the Maryland-based National Foundation for Consumer Credit, established in 1951.
Lee said that Taiwan should learn from the US and set up private institutions which can assist debtors and help to instill better budgeting policies.
Visa International and MasterCard International have both launched interactive Chinese-language Web sites to enable consumers to give themselves a thorough financial check-up and to help them deal with their debt issues. The companies are also scheduled to hold a series of forums on university campuses around the nation, with the first seminar hosted by MasterCard taking place in National Chengchi University today.
The Consumers' Foundation also urged lawmakers to pass the amendments to the Bankruptcy Law (
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