AfricaPress-Tanzania: PRESIDENT John Magufuli has asked the Judiciary on Monday to block mortgage defaulters currently filing for a court injunction against their lenders, warning the act has a huge toll on the country’s economy.
President Magufuli’s request came after four banks, Azania Bank, TIB Bank, TPB Bank and CRDB Bank reported to be facing about 378 lawsuits worth over 738.99bn/- filled by defaulters in various courts.
The president revealed at the climax of the country’s legal week and commemoration of 100 years since the establishment of the High Court in Tanzania that there could be more other banks suffering in the hands of dishonest debtors.
“This has a serious impact on the economy. The act is forcing banks to set high mortgage rates to repay underperforming loans,” said Dr Magufuli at the ceremony in the capital Dodoma.
“It has led to an increase in operating costs… banks continue to pay interest on deposits used to provide loans to debtors who have filed injunctions at the court.”
Details show that as of December 31, 2020, a total of 36 Azania Bank customers prayed for the court to block payment of more than 352.27bn/- unsettled loan.
A total of 44 TIB customers also filed an injunction worth over 167.267bn/- in unpaid loans and 16 other TPB customers who owe a total of 6.2bn/-.
President Magufuli says CRDB bank had registered 282 lawsuits worth over 400bn/-.
“Large amounts of money continue to be held by chronic debtors. I call on the court to look into this,” he said, insisting such cases could derail the country’s economy.
