Just as mounting household debt in Sri Lanka’s war-affected region began drawing national attention, a young mother in Jaffna, said to be heavily indebted, consumed poison along with her three children and died on Friday.
Local media reports said the woman added poison to ice cream and fed her children, after which she had some herself.
“The mother was 28, her children were 4, 2 and 1. We are investigating the case. We suspect that their death is related to the pressure of having to repay a huge debt,” a police spokesman told The Hindu . The young woman’s husband committed suicide about a month ago, unable to settle loans, police said.
‘Acute problem’
“We are increasingly hearing about the acute problem of debt, especially from women’s groups. Banks and microfinance companies go to virtually every doorstep and thrust these loans upon naïve people who are struggling to make ends meet. And then, they harass families to repay them,” said N. Vethanayahan, the Government Agent of Jaffna.
After Sri Lanka’s civil war ended in 2009, many banks and microfinance companies opened branches in the war-hit north and east, giving out loans to families in dire need of money for basic sustenance in the absence of income sources. The interest rates are as high as 70%, and force borrowers to take new loans to service their existing debt, according to officials. Not just in the north, but the island’s Eastern Province has also recorded cases of debt-ridden individuals trying to sell their kidneys and some even committing suicide, as their debt trap deepens.
Addressing the issue
Recognising the prevalence and seriousness of the problem, a high-level team from the Central Bank travelled to the north earlier this month for discussions with stakeholders to evolve responses to address it.
“Today’s incident shows us the magnitude of the issue. We have decided to intensify our awareness drive immediately. We cannot afford to lose another life because of loans,” Mr. Vethanayahan said, adding that the heavy burden of outstanding debt and the aggressive recollection strategy of companies is pushing people to the edge.
Observing that predatory debt is “contagious”, Jaffna-based political economist Ahilan Kadirgamar said: “What began as high interest microfinance loans is now pushing people to even mortgage their homes to money lenders. We need a holistic solution, including affordable rural credit and a cap on interest rates.”
