Loan deferral decision helped Bahraini families overcome COVID-19 financial challenges | THE DAILY TRIBUNE | KINGDOM OF BAHRAIN

Loan deferral decision helped Bahraini families overcome COVID-19 financial challenges | THE DAILY TRIBUNE | KINGDOM OF BAHRAIN

The study, "An Assessment on the Impacts of Loan Deferrals in Bahrain", by Sara Bahman and Omar Al-Ubaydli, was published by Bahrain Center for Strategic, International, and Energy Studies (Derasat) based on the Derasat-UNDP partnership to study the socioeconomic impact of Covid-19 in Bahrain. The study analyzes the first two decisions of the Central Bank of Bahrain CBB) to defer loan repayments for Bahrainis, in March 2020 and in September 2020, based on interviews with over 100 Bahraini households. The research paper concluded that loan deferrals, especially the one in March 2020, helped Bahraini families overcome the financial challenges posed by Covid-19, including decreased income and increased expenditure: a reassurance factor among them. The paper affirmed that had the deferrals not been approved, many Bahraini households would have had to use a combination of decreased expenditure and running down savings to manage their finances. A small percentage would have seriously considered defaulting on their loans were it not for the deferrals. According to the paper, the most important factor in determining a household's support for and benefit from the deferrals was its financial strength, as measured by its income and the percentage of monthly income allocated to loan servicing. Households