Since the beginning of the debt crisis in 2009, both the country and the people of Greece have struggled under the weight of large sums of debt.
Now, one of the country’s biggest banks has announced plans to forgive or restructure the debts of its poorest clients to help ease some of the financial burden on them.
In a statement, the Bank of Piraeus called the economic situation in Greece a “humanitarian crisis”, and announced that it would be writing off the debts of clients who owe up to 20,000 euros ($21,600) on their credit cards or consumer loans.
The bank also said that would it would be temporarily freezing mortgage payments and forgiving any interest associated with them. However, clients must already be enrolled in a new government benefits program to qualify for the debt relief.
“Despite two bailouts worth up to 240 billion euros, six years of recession has wiped out a fifth of the Greek economy with many people being thrown out of their jobs or seeing their wages slashed.”
Greece is currently engaged in tense negotiations with the European Union, European Central Bank and the International Monetary Fund as it tries to secure the remaining 7.2 billion euros of bailout loans that were set aside for the country.
If Greece is unable to secure these loans — which are contingent on the country enacting a number of financial reforms — the government could soon default on its debt. According to The Guardian,
“The state is scrambling to find funds to pay almost €2bn ($2.17bn) in wages and pensions and almost €1bn to the International Monetary Fund in the coming weeks.”
Money has become so tight that the Greek government recently issued a decree earlier forcing public sector entities to hand over any idle cash they had to the central bank.
The government said that the controversial decree was issued as a result of, “extremely urgent and unforeseen needs.”