Magistrate Slams Excessive Fees, Rules Loan Unenforceable

A recent judgment from the lower court is shining a spotlight on how moneylenders work in Belize and whether the rules are fair. Bathsheba Limited took Shermadine Dennison to court, claiming that she owed over five thousand, five hundred dollars on a two-thousand-dollar loan. That bill included interest, fees, and a huge two-thousand-dollar recovery charge. And here’s the kicker, Senior Magistrate Baja Shoman threw out the entire claim because the promissory note didn’t meet the law’s basic requirements. It never stated the effective annual interest rate, which is mandatory under the Moneylenders Act. That single omission made the contract unenforceable. She didn’t stop there. Senior Magistrate Shoman ruled that the interest terms weren’t clearly agreed upon; also, the “permissible” fees weren’t properly disclosed. And that two-thousand-dollar recovery fee? The court called it excessive and unconscionable. So, what does this mean for you? If a licensed lender can get it wrong, how many borrowers know their rights? Should recovery fees ever equal the loan amount? And is the system doing enough to protect consumers?