100 minibuses repossessed in Hong Kong after owners failed to repay bank loans: operators
- About 100 minibuses towed away over past three years as banks take actions against owners unable to pay instalments, operator says
- ‘Some owners died, but most cases involved owners unable to afford loans,’ he adds
About 100 minibuses have been towed away after owners failed to repay bank loans, Hong Kong operators have said, citing practical pandemic-induced challenges.
Chow Kwok-keung, the chairman of the Taxi and Public Light Bus Association, said on Thursday banks had not requested early payments, but some owners’ minibuses were taken away because of overdue instalments.
He warned 100 more minibuses might face the same fate if the government did not intervene.
“Over the past three years, about 100 vehicles have been towed away,” he told a radio programme. “Some owners died, but most cases involved owners unable to afford loans.”
The minibus confiscation became known to the public after some banks were said to have demanded several owners repay call loans amid a sharp decrease in the prices of the vehicles’ licence plates.
A Facebook page set up by residents working in the minibus industry recently said a bank had taken action against owners who had taken out HK$4 million (US$511,450) to HK$5 million in loans.
It added some owners had abandoned their vehicles at minibus stops or in the countryside.
Driving a taxi or a minibus in Hong Kong requires a special licence with a quota in place, making it a speculation commodity that has its own betting market.
The number of public light buses was fixed at a maximum of 4,350 vehicles, the Transport Department said.
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The prices of minibus licence plates once peaked at HK$8 million in 2011 but fell to about HK$1 million after the Covid-19 pandemic, with some plummeting to as low as HK$700,000.
Cheung Hon-wah, the chairman of the Public Light Bus Owner and Driver Association, said prices started to drop as early as 2015 after the opening of the westward extension of the Island line from Sheung Wan to Kennedy Town, which pushed minibus drivers working on Hong Kong Island to Kowloon and created competition.
“Many [minibus owners] can’t even afford to pay out of their own pocket to keep the vehicles and have to return them to the banks,” he told another radio interview.
Cheung appealed to minibus owners to discuss other solutions with their lenders, and asked that the vehicles not be towed away as long as they repaid their loans on time.
The Hong Kong Monetary Authority said on Wednesday banks would not normally ask their customers for early repayments. It added banks repossessed only a few vehicles as collateral after their owners fell behind with repayments.
An authority spokesman said about 150 minibus operators had been receiving credit help from banks, with 10 at present asking for a payment holiday, where owners could refrain from repaying their loan principal.
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Chow said he expected another 100 vehicles would be towed away if the government did not introduce measures to help the industry.
The Hong Kong minibus industry has in recent times suffered a staffing shortage after more than 1,000 drivers were said to have quit to work for shuttle companies after the city reopened its borders with mainland China last year.
There were 3,299 green minibuses operating in scheduled services on 355 routes last June and 823 red ones that offered hailing services in the city.
