Report: Lebanese use Hezbollah for loans amid the financial crisis

Lebanese have turned to Hezbollah for loans and cash amid the country’s financial crisis, according to an Associated Press (AP) report.

Cash-strapped Lebanese have used the Al-Qard Al-Hasan association to circumvent capital controls, which prevent account holders from accessing their savings, imposed by the country’s banks.

The association, which is the financial arm of Hezbollah, has continued to hand out loans and cash dollars to clients despite the economic crisis, according to AP.

Meanwhile, banks in Lebanon have seen hours-long queues of angry depositors attempting in vain to access their dollar savings.

Most banks have also stopped giving loans, but Al-Qard Al-Hasan, whose name in Arabic means “the benevolent loan”, has continued to dispense interest-free loans of up to $5,000.

Clients must use gold or a guarantor in order to secure the loan, which must be paid back in monthly installments for up to 30 months, after which the collateral is returned.

The loans have allowed people to pay school fees, get married, buy a used car, or open a small business, the report said.

As a result, in the last 12 months Al-Qard Al-Hasan, which has been sanctioned by the US since 2007, has seen a significant increase in clients.

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In a recent speech, Hezbollah leader Sayyed Hassan Nasrallah said an estimated 300,000 people from across Lebanon’s various sects were currently using loans from the association.

A spokesperson for the organisation was cited by AP saying that the uptick in the number of clients was because people had lost confidence in the banking sector and were therefore forced to find reliable alternatives.

The association’s clients are still able to open savings accounts with the association, which is officially registered as a non-profit charity, despite the economic crisis.

Hezbollah has continued to pay its fighters and employees in US dollars, according to the report.

However, everyone else in Lebanon receives their salary in the local currency, the pound, which has lost more than 80 per cent of its value since October 2019.

Lebanon’s financial crisis, its worst since the end of the civil war in 1990, has pushed nearly 50 per cent of the population under the poverty line and thousands around the country into unemployment.

A solution for the crisis-ridden country’s problems seems far off, however, especially since Lebanon has no official government.

Caretaker Prime Minister Hassan Diab’s government resigned in August in the wake of the Beirut blast that killed nearly 200 people and rival political parties have failed to agree on a line up for the next cabinet.

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