His solution at a glance: The economic effects of the Coronavirus crisis pose a high risk for millions of people with a middle–class income. Radek Hábl is working with an evidence-based, holistic, and systemic approach to transform the current unfair ecosystem of household debt. His work is becoming increasingly relevant each day of this global crisis come existential economic crisis.

The mission of the social enterprise before Corona:

Decrease the number of people facing repossession orders & escape the debt trap!  

By spurring close cooperation among key actors, Radek aims to bring a million of over-indebted and excluded Czech citizens back to society. Radek’s strategy is to establish fairer conditions for those in debt and to establish better support mechanisms to get people out of debt. 

What changed with Corona?

The risk of debt has massively increased due to the economic crisis of Covid-19, particularly affecting the middle-class people. The work of “Repossession Map” is needed now more than before, as the fight for justice and economic freedom has come to the forefront for many. 

In general: One of the most pressing social issues in the Czech Republic is the high over-indebtedness of more than 10% population. Even without an acute economic crisis as the one connected to COVID-19, the debt trap affects 1 out of every 10 Czech citizens. Once people enter the circle of debt, every second person facing repossession orders had so far no chance to escape this trap for the rest of their life.

The overall numbers of over-indebtedness are expected to increase dramatically with the economic effects of the current lockdown. Action is needed to prevent chronic social exclusion and economic deprivation of entire families with substantial risks for the future of their children!

1. Radek aims for changing the legal framework. He aims for changing the system! Therefore, he advocates legislative changes to prevent a rapid increase of people at risk of debt. He works with local municipalities and organizations to build rescue networks and strategies, which include preventative and corrective actions.

2. At the same time, he creates and boosts data sources and detailed analyses e.g. for household indebtedness needed for the targeted solutions.

3. Radek and his team are boosting cooperation amongst employers as they are the ideal channel for helping people in fiscal crisis.

The impact: Radek has already achieved significant legislative changes as a response to COVID-19. Amongst them: the possibility of a one-time lump-sum withdrawal of up to four times the poverty line from a seized bank account. With this, entrepreneurs will enter debt relief under the same conditions as other natural persons, reduction of the contractual penalties for consumer loans after repayment.

Ashoka: How are you dealing with the situation and what is your biggest personal worry?

Radek: “I am worried about the global negative economical and social impact of Coronavirus crisis which, might be more devastating than last big (economic) crisis.”

Ashoka: What is inspiring you and giving you hope that we can overcome this crisis?

Radek: “Every problem is also an opportunity. I believe that crisis can bring us new solutions and approaches and can move us forward.”