When Gopal Choudhary ran up Dh327,000 in debt in less than 18 months, he considered not returning to Dubai from a trip to India.
But the mechanical engineer decided to face the consequences of the liabilities he had accumulated from making a bad investment.
“I studied a master’s in philosophy, so it is very tough for me to run from anything,” says Mr Choudhary, who is from India and moved to Dubai 18 months ago.
Three months after joining his company, where he earned Dh12,000 a month, he took out a personal loan of Dh200,000 from ADCB to pay his share of an investment which had been proposed by a colleague.
There were three partners in the deal to lease a hotel, restaurant and club in Dubai.
“They [the owners] told me: ‘you invest this much money and we will take care of the rest.’ I took that Dh200,000, then another Dh50,000, then another Dh50,000 [both from FGB], so in total you could say more or less Dh300,000. My partners’ investment was about Dh300,000 each as well,” says Mr Choudhary.
ADCB says it cannot comment on specific customer cases, but says its service quality unit handles all customer inquiries. “We do take finding a solution for our customers very seriously,” a spokeswoman for the bank adds.
FGB declined to comment.
Business was good for the first two months, but it started declining after that and the overheads were high.
“We had to pay the electricity bills, rent and the staff’s salary, all of these things. Later on when this business wasn’t running well and we needed further investment, I didn’t pay anything. Both of my business partners took care of it.”
The owners closed the hotel in January, leaving Mr Choudhary no chance to recoup his investment.
“How I lost that money I cannot explain. It’s already done. It’s already gone,” he says.
“I have lost all hope of getting any money back. It is hard to even get an appointment with the partners and they don’t know English or Hindi.”
He has two personal loans, one with Dh166,000 outstanding to ADCB and another with Dh35,000 outstanding to FGB, plus five credit cards on which he owes Dh113,000 to five banks, including ADCB and FGB. In addition, he owes another Dh13,000 to another finance company.
The repayments added up to about Dh9,000 a month – representing three-quarters of his monthly salary at the time.
“It wasn’t perfect for me because there was no additional money but as far as the bank was concerned they were getting their money,” he says, adding that he never hid his liabilities when applying for more credit.
“I was always honest, despite all my hurdles,” he adds.
Then in February he lost his job.
He made minimum payments when possible, but is behind by two months on most of his obligations.
Despite securing a new job with a new company in May, his new salary is only Dh9,500 a month, leaving him just Dh500 a month to live on. Thankfully his new employer provides him with accommodation, so he only has to pay for his food.
“Two times I went to India and thought so many times about what to do, but ultimately I decided that I would go back and see what needs to be done to get rid of this,” he says.
“I did inform the bank each and every step I have taken so far. So far I am managing,” he says.
ADCB has agreed to reschedule his credit card and loan, rolling them into one consolidated loan with a lower repayment. And he has Credit Shield insurance, a policy that pays for instalments in the event of involuntary loss of employment, for one of his other loans. It covered May’s monthly instalment, but it will eventually stop when the insurance company learns he got a new job.
Friends are helping with his day-to-day expenses, but he is adamant that he will eventually be debt-free.
“I haven’t asked anyone to clear my debts. I decided I won’t take anymore money from anybody and whatever I will do, I will do myself.”
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