Committee for the Abolition of Illegitimate Debt

The country has taken the measures announced by the Economic Vigilance Committee to address the impact of the Corona virus pandemic. However, these measures have not yet included micro-finance victims. The professional group of Moroccan banks has announced that those who have lost their jobs due to the Coronavirus pandemic (employees, professionals and small businesses) would benefit from the procedure for deferring the repayment of their debt. Those affected may, upon application to their banking institutions, suspend payment over a period of three months until 30 June 2020, renewable once for a similar period. This measure concerns real estate loans and consumer loans with the condition that warranty of the “Caisse Centrale de Garantie” and life and disability insurance coverage are extended for the same period.

The “clients” of microcredit institutions, about 900,000 people, half of whom are women, are mainly working-class and low-income earners. They borrow with interest rates Interest rates When A lends money to B, B repays the amount lent by A (the capital) as well as a supplementary sum known as interest, so that A has an interest in agreeing to this financial operation. The interest is determined by the interest rate, which may be high or low. To take a very simple example: if A borrows 100 million dollars for 10 years at a fixed interest rate of 5%, the first year he will repay a tenth of the capital initially borrowed (10 million dollars) plus 5% of the capital owed, i.e. 5 million dollars, that is a total of 15 million dollars. In the second year, he will again repay 10% of the capital borrowed, but the 5% now only applies to the remaining 90 million dollars still due, i.e. 4.5 million dollars, or a total of 14.5 million dollars. And so on, until the tenth year when he will repay the last 10 million dollars, plus 5% of that remaining 10 million dollars, i.e. 0.5 million dollars, giving a total of 10.5 million dollars. Over 10 years, the total amount repaid will come to 127.5 million dollars. The repayment of the capital is not usually made in equal instalments. In the initial years, the repayment concerns mainly the interest, and the proportion of capital repaid increases over the years. In this case, if repayments are stopped, the capital still due is higher…

The nominal interest rate is the rate at which the loan is contracted. The real interest rate is the nominal rate reduced by the rate of inflation. exceeding 30% and are exposed to threats from microfinance institutions when they encounter repayment difficulties due to unstable working and living conditions and regression or interruption of their income.

The repercussions of the Corona virus pandemic will aggravate the crisis of microprojects and subsistence agriculture, and their bankruptcy will spread. The social and psychological conditions of micro-finance victims will deteriorate due to the loss of their jobs and livelihoods. Their spending will increase to guard against the spread of the epidemic in the face of the public health system dismantled by decades of liberal policies in favour of the private sector. Containment also imposes the acquisition of basic consumer goods whose prices are rising as a result of price liberalization and the reduction of the budget of the compensation fund and the import of most food items, in addition to water and electricity bills, rents, children’s education, etc. The cost of these goods is increasing as a result of the liberalization of prices and the reduction of the budget of the compensation fund and the import of most food items.

Victims suffer from pressure from micro-credit institutions that impose prejudicial conditions included in contracts where victims do not read the conditions and sign under duress. These institutions have accumulated huge profits in recent years from borrowers’ pockets.

It is time to stop this greed. The necessary protection against the spread of the Corona virus and the resulting crisis makes it urgent to stop the repayment of micro-loans.

Thus, the Association ATTAC CADTM Morocco calls for :

• the Stopping of payment of monthly microcredit installments for a period of six months, renewable, with exemption of all interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. .
• Allocation of an indemnity, at least equal to the minimum wage, for the benefit of microcredit victims whose projects have gone bankrupt or who have lost their jobs.

It also calls on the victims of microcredit to mobilize for :

• Implement measures to suspend the repayment of microcredit and interest exemption
• Organize within a national association to collectively defend their claims against the arbitrary practices of micro-finance institutions.
• Collect signatures, and even submit a petition to the government in accordance with Organic Law No. 44-14, to decree a suspension of repayment of microcredit debts.
• Reach half a million signatures and mobilize to achieve this goal.
• Collect signatures electronically due to quarantine requirements.

The association ATTAC CADTM Morocco :

• Places itself at the disposal of all victims of micro-finance to follow these steps in order to win the battle of stopping the payment of monthly installments for a period of 6 months with exemption of all interest.
• Calls on all struggling organizations to show solidarity and stand by the borrowers of micro-finance institutions, and to support the demand for the suspension of loan repayments and exemption from interest in order to reduce the burden of containment’s consequences.
• Stresses the need to take all preventive measures against the coronavirus epidemic.

To contact our organization, please use the following links or numbers:

• Website: https://attacmaroc.org/
• Facebook Page: https://web.facebook.com/attac.maroc/
• Email Address: attac.maroc@gmail / attac.cadtm.maroc at gmail.com
• EL BELGHITI Fatima-Zahra : 0613752290
• AZIKI Omar: 0661173039
• LAKRAKER Samia: 0767440371
• AZNAG Ali: 0672368376

National Secretariat

Translated with www.DeepL.com/Translator (free version)

Arabic version : https://bit.ly/3aw6Vdl