Residents overburdened with debt have spoken of their ordeal, with many blaming banks for coming down hard on customers who were “pushed” to take out huge loans in the first place.

They complained banks are laying debt traps, by granting relatively large loans and credit cards to customers with limited income, who then struggle to return the piling interest and late payment fees – with disastrous results in many cases.

Many residents continue to be jailed for bouncing post-dated or “guarantee” cheques – a crime here as opposed to a civil case in the wider world – which they had to write out as repayment terms. And with no bankruptcy protection under current laws, expat debtors often make the choice to flee rather than go behind bars.

Unable to cope, some residents have committed suicide, while others have gone underground.

The problem, debtors told Gulf News, is that credit has been made too easy to obtain but too hard to clear once repayment schedules breakdown in unforeseen circumstances. Many of those who contacted Gulf News about their cases said they were ordinary employees who were offered loans and credit cards worth hundreds of thousands of dirhams.

They claimed there were “pushed hard” to accept the debt products, an offer that was not difficult to accept as they happened to be in a financial crunch. Job loss, health emergency, death of a family member, rising rent, school fees – the list of reasons cited by them were varied and long.

Some defaulters also spoke of landing in a catch 22 situation – being unable to repay because of being laid off and being unable to land work because of being a defaulter in a criminal court case.