Latvians prepared to sell their souls for quick cash

Jul 7, 2009, 10:20 GMT

Riga - Desperate residents in the recession-hit Baltic state of Latvia are willing to sell their souls in order to obtain small loans.

Loan company Kontora, based in the Latvian capital, Riga, is offering loans of up to 500 lats (1,000 dollars) with borrowers' souls serving as the only collateral.

'I, the undersigned do hereby take the loan from the Creditor under the known-to-me terms and conditions on the security of my immaterial intelligence, i.e. immortal soul. I also do hereby certify that the said bail is the property of the undersigned and is not promised to anyone,' the loan agreement reads.

So far, around 200 borrowers have signed away their souls, according to Kontora owner Viktors Mirosichenko, despite the fact interest rates on the 90-day loans are extremely high at 1 per cent per day.

Religious leaders expressed dismay at the scheme.

'Maybe there is a religious motivation behind this - Satanism, the occult or something of that kind - in an attempt to destroy human souls,' said a joint statement from Lutheran, Catholic and Orthodox clergy.

Latvia is experiencing the deepest recession felt by any European Union member, with its economy expected to contract by at least 18 per cent this year.

Government attempts to balance the books have resulted in widespread job losses. Many Latvians are struggling to keep up payments on borrowing they took out during the boom years.

With banks reluctant to lend, people in need of quick cash are increasingly turning to independent loan companies operating on the fringes of the financial markets.

Advertisements on trams and buses offering loans via SMS message are commonplace, but are usually provided at high interest rates.