The so-called double loan problem continues to hinder the rebuilding of people’s lives and businesses in the northeast.
Of some 200,000 houses destroyed by last year’s tsunami, 8,000 are believed to have outstanding loans on them. Firms that made huge capital investments before the disaster have been affected in a similar way.
Although some steps have been taken, survivors still face difficulties getting access to the right information or are overwhelmed by complicated systems to receive support.
For instance, a government-backed bailout scheme that provides homeowners with debt relief out of court was launched in August 2011. After 12 months, the organization in charge of the program had provided consultations in 2,510 cases. Of them, a mere 70 have been resolved.
The potential demand for the bailout scheme is expected to be “close to 5,000 to 6,000,” an official at a regional bank said, suggesting the scheme has been not been promoted well enough.
Some people erroneously use their insurance coverage or relief money to repay debts or take out new loans, sources said. Also, many mistakenly believe that applying for the debt relief will hurt their credit ratings.
Organizations set up to help disaster-hit companies are also not functioning well, mainly due to a lack of coordination between them.
Sky-high flood damage
The total cost of damage caused by flooding around Japan in 2011 came to ¥956.5 billion, the worst level since 2004, the land ministry said in a preliminary report.
Of the figure, ¥509.4 billion, or about 53 percent, was caused by a powerful typhoon that triggered large-scale landslides on the Kii Peninsula in September.
Wakayama was the hardest-hit prefecture with ¥262.5 billion worth of damage, while Mie was No. 3 at ¥103 billion. Both are on the Kii Peninsula.