Abu Shams could not believe that the National Investment Commission had included his name on a list that was sent to one of Rafidain Bank’s branches and that he would eventually own his own home after years of waiting. He will now pay his own rent instead of the monthly rent that he had been paying to the landlord for many years. He will ultimately pay the total amount due on his apartment, which includes the monthly rent payment to the bank. He was surprised, however, by what he referred to as “the exorbitant usury” that the citizen was subjected to by “the state, not the usurers.”
“In the nineties of the last century, my father, may God have mercy on him, was forced to sell our house due to the deterioration of the economic situation and opened a simple project that barely provided for our daily needs,” says “Abu Shams,” a pseudonym because he fears that if his name appears in this report, his bank transaction will be hampered and he will be deprived of his dream apartment. Eventually, the undertaking lost, and from that point forward we have been moving starting with one house then onto the next.”
Dream under the whizz of slugs
Abu Hoaxes is a worker of the Service of Inside. Beginning with Al-Qaeda and concluding with ISIS, he fought terrorist groups. He remained in Mosul until June 9, 2014, when he and his coworkers withdrew from the devastatingly depopulated city.
“The danger of ISIS diverted us from all the other things, yet regardless of that, the fantasy about claiming a house never left me, as did my partners who experience the ill effects of the issue of lease. I was discouraged from moving into the Bismayah complex after it opened. Even if it only has room for a motorcycle, my ideal home would include a garage and a small garden. However, my dream persisted as the days passed in vain.
Abu Shams says, “After searching, trying, and using connections, I obtained an exception late last year for a 120-square-meter apartment.” An exception is a special approval from a government or parliamentary official. I started the procedures, and after many long reviews, my name got to one of Rafidain Bank’s branches. I didn’t think the dream would come true, so I rushed through the procedures and paid the down payment.
Unprecedented interest on the part of the government “But after my joy subsided, I went back to the transaction papers and the bank instructions that I had copied, and I flipped through them to believe that I would finally own a home. Even though I had taken a picture of it with my phone, I was shocked by something I hadn’t noticed or expected during the transaction. It was as if I hadn’t read it. It was the bank revenue, which ended up being roughly half of the first advance sum, and not 4% as the Rafidain Bank the board claims,” Abu Hoaxes added.
He makes the observation that “some people and exchange offices deal with usury, but they impose interest on the principal amount not exceeding 30%.” However, “what the government banks do, the usurers did not do, even the Western banks whose greed we hear about and about which we watch some movies did not impose such interest, 50% on government money that is basically the people’s money?”
“In addition, I discovered that I was compelled to pay a monthly insurance premium of 42 thousand dinars, or approximately four million and 500 thousand dinars annually. This is despite the fact that I did not request insurance for my apartment and I was not even asked if I desired it. It was forced on me, and everyone is aware that Iraqi insurance companies merely steal citizens’ money without compensating them. In the Bismayah complex, dozens of apartments burned down, and their owners were not compensated,” Abu Shams came to a conclusion.
Abu Shams photographed the following instructions from Rafidain Bank’s General Administration on the bulletin board in the bank branch where he promoted his transaction:
Price of apartment: According to the official rate of 1,320 dinars for every dollar, 85,680 dollars equal 113 million 97 thousand 600 dinars.
From the total cost of the apartment, the bank’s down payment: 11 million, 309,000, and 760 dinars, making the amount of the bank loan 101 million, 7879,000, and 840 dinars from the apartment’s purchase price.
Month to month bank revenue: 170.000 212 dinars.
Period of loan repayment: 250 months equals 25 years.
Aggregate sum of bank revenue: The loan’s 300-month repayment term divided by the loan’s monthly interest of 170,212 dinars yields 51 million, 63 thousand, and 600 dinars, or 50 percent, rather than the 4 percent claimed by Rafidain Bank’s general administration.
Haifa Hadi, a government worker, explained to Shafaq News Agency, “In the last quarter of 2019, I applied for a twenty million dinars advance, as my husband intended to open a simple project that would help us secure our daily needs.” “I was fooled once and that’s it.” I received the advance at the end of the same year, but they only gave us 19 million and 440 thousand dinars. The bank employee explained that this was the sponsor’s fee when I inquired, so I asked, “Why didn’t you tell me that you wanted a sponsor, and I basically have a MasterCard issued by you?” She responded, “These are the steps.”
She went on to say, “This was the first surprise, and it is simple in comparison to the interest on the bank.” Although the General Administration specifies that the interest should be 8% of the principal amount, the actual interest rate is 50%. I have been making monthly payments of 30 million dinars for the past four years; when I inquired about this, they informed me that the interest is calculated by multiplying the number of years of repayment by six.
Hadi points out, “The biggest problem is that due to the spread of the Corona pandemic and the accompanying curfew that lasted for nearly a year, my husband was unable to start his project.” Additionally, Hadi says, “We were forced to withdraw from the advance amount to secure our needs, and the amount decreased to a point that it was no longer useful for any project, and my salary is still deficient because of this ill-fated advance.” “The biggest problem is that due to the
Hadi says, “I was once taken advantage of by the government and its banks, and thank God the amount was somewhat affordable, and there was only a year and a half left to pay it off.” This is the conclusion of his essay. Hence, neither my better half nor I will permit the banks to exploit us in the future for quite a long time. One bite is sufficient.
The poor will only borrow.
A worker at Rafidain Bank, who didn’t like to specify her name, told “Since the public authority banks sent off advances and credits over a long time back, we, the representatives at the banks, have not applied for them with the exception of when we are compelled to do as such because of the great bank revenue.”
She affirms, “I have been working in banks for almost 35 years, and I know about the financial frameworks in a few European nations and America. Even if this is merely information, it enables me to assert without reservation that our banks’ banking interest rates are unparalleled worldwide.
Banker Aqeel Al-Ansari, an Iraqi who lives in London and works in a British bank, said, “Bank interest in Iraq can be described as theft, fraud, or extortion in the name of the state” in a phone call with It is unreasonable and illogical for a government bank to charge an interest rate of fifty percent or sixty percent on a small amount used to buy a car, start a small project, or buy a house, and to do so for a period of time that is disproportionate to the amount used.”
“Despite the fact that capitalist nations like Europe and the United States have banks that are renowned for their avarice and greed, they are still nothing in comparison to what is taking place in Iraq. For instance, if you want to buy a car, you can get a $10,000 loan from a bank in the West at an interest rate of no less than 10%. However, your monthly payment will be lower than the total amount and its interest. You can go to the bank and say, “I want to buy a newer car and I need an additional amount” after a year or two. They will provide you with what you want, and you will be able to easily and quickly sell the car, which is not possible in Iraq. This is abnormal.”
“What is happening in Iraq is an actual blackmail operation practiced by the state against the citizen,” Al-Ansari emphasizes. It takes advantage of his need for a home, to start a simple project, or to buy a car to bribe him with exorbitant bank interest, which ultimately results in the project’s failure or a reduction in its profits due to the monthly payment, as well as an increase in the cost of real estate and automobiles. This is a really bizarre condition if we have any desire to utilize conciliatory language, yet it is hard to depict it precisely in light of the fact that it is hostile.”
“It seems that those who manage the financial system and set its plans are people who have nothing to do with money or the economy, neither closely nor remotely,” the Iraqi banker believes.
“Bismaya Complex, and what do you are familiar Bismayah Complex?” “The price of one square meter of an apartment in Bismayah Complex is 630 dollars, while the real value of the meter is 300 dollars, but the state imposed double the price on the citizen to cover the costs of the project’s infrastructure, including streets, water and electricity networks, sewage, schools, and others, in addition to the road linking Bismayah Complex to the city of Baghdad,” economic expert Nasser Al-Kanani began his conversation with Shafaq News Agency with this
He continues, “The apartment, which is supposed to be 100 square meters according to the contract concluded between the citizen and the Investment Authority, is actually 85 square meters, meaning that all apartments have areas of 100, 120, and 140 square meters, minus 15 square meters, which is the area of the corridor that leads to all the apartments, as well as the area of the elevators and stairs.” This means that each apartment has a total of 140 square meters.
Al-Kanani states, “The problem is not whether it is fraud and deception by the state, but rather the problem lies in the citizen’s silence about it.” In response to the question of whether this incident qualifies as “fraud and deception by the state against the citizen,” Why did the citizen refuse to speak up about the 15 square meters that the state took from him and turned into streets, schools, and other things at his expense? Anyone who lives in Bismayah can confidently tear off the door of one of the schools and say: I am the owner of this door, and I paid for it.
Al-Kanani calls attention to that, “Then again, the resident is the person who paid the expenses of the task’s framework, and the state didn’t stop there, yet rather conceded the resident advances with exorbitant financing costs that exist in no bank on the planet, even in entrepreneur nations like Europe and America, as there is no revenue that spans half of the first credit sum.”
He emphasized, “The state has not provided the citizen in the Bismayah complex with anything.” The Iraqi constitution’s Article 30 states that “the state guarantees the citizen the right to housing and a decent life,” which means that the state must provide free housing and job opportunities for the citizen. However, the citizen bears all costs and also contributes significantly to the state’s profits.
He states, “The price per square meter in the Bismayah Complex when the Investment Authority started selling was according to the dollar exchange rate at the time 1180 dinars per dollar, but now the state calculates the exchange rate at 1320 dinars, which means that there is a difference estimated at about 140 dinars per dollar, and this difference in exchange is borne by the citizen, while the state is the one that raised the exchange rate and the citizen is not to blame.” He adds that the difference in
Al-Kanani affirms, “In all nations of the world, even entrepreneur ones, there are two sorts of credits. The first is that when one nation lends money to another, the interest rate is set at no more than 1% to 1.5%. The loans that individuals receive from banks to purchase homes do not exceed 2% of the original loan amount.
MPs “evade” Despite two days of repeated attempts to obtain a comment from the members of the Parliamentary Finance Committee, the representatives did not respond. Even though the increase in the bank interest rate was brought up several times in front of the parliament by a number of representatives, some of them did not respond to the calls and others apologised for making a statement under the pretext that they did not have any information on the subject.
“The interest imposed by Iraqi banks is unparalleled in any bank in the world” was a bold statement made by one of the representatives to the correspondent. Despite the fact that the issue does not involve any political sensitivity, he promised our correspondent that he would bring it up during one of the upcoming parliamentary sessions. However, he preferred not to mention his name.
A responsible source in the General Administration of Rafidain Bank stated, “We are an executive body and we have no relation to determining the prices of housing units and the bank interest due on housing loans.” Rafidain holds the Investment Authority accountable. He stated, “These things are agreed upon with the National Investment Authority.”
It is important to note that private and government banks are more like independent entities and have no authority other than the Central Bank of Iraq. Every one of their methods and guidelines, the advances and monetary credits they award, and the financial premium they force are totally autonomous of the public authority, its services, and its foundations, as per numerous assertions and announcements gave by the National Bank of Iraq, the actual banks, government authorities, and agents, at past times.
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