BEIRUT – When Lebanon’s financial meltdown began in late 2019, Hassan Shoumar was locked out of his dollar savings like everyone else in the country as banks clamped down with capital controls.
But the young engineer had an alternative. He could still pull out the dollars in his account at the al-Qard al-Hasan Association, the financial arm of the militant Hezbollah group.
Shoumar had kept an account at the association for years, ever since he had taken a loan from it to pay university fees. Unlike Lebanon’s commercial banks, the accounts at the association didn’t earn interest. But the 28-year-old Shoumar didn’t care about that.
“What I care about is that when I want my money, I can get it,” he said by telephone from south Lebanon.
Stepping in where the state and financial institutions have failed, Hezbollah is providing a vital lifeline for some Lebanese. In the country’s wrecked economy, everyone is desperate for hard currency and liquidity as the local currency plummets in value. At commercial banks, depositors stand in line for hours and fight with managers in vain to access their dollar savings. Most banks have stopped giving loans.
But at Hezbollah’s al-Qard al-Hasan people can take out small, interest-free loans in dollars, enabling them to pay school fees, get married, buy a used car or open a small business. They can also open saving accounts there.
The association, officially a non-profit charity, is one of the tools by which Hezbollah entrenches its support among the country’s Shiite population, even as the group has come under enormous criticism over the past year among Lebanese furious at the political elite.
With poverty rising across Lebanon, Hezbollah provides its community with low-cost schools and hospitals and distributes heating fuel to the poor. Hezbollah continues to pay its fighters and employees in its institutions in U.S. dollars, while everyone else gets their salaries in Lebanese pounds, which lost about 80% of their value in the crisis.