Another Pyramid Scheme

At any time, there will be at least two or more pyramid schemes running in Bhutan despite notifications by the government.

Pyramid schemes are not new to Bhutan and have been there for decades and many people have lost millions but we never seem to learn.

It is time to examine why Bhutan and Bhutanese are such fertile grounds for these dodgy schemes.

One major reason is a lack of financial literacy in the country. It is often the educated who fall for these schemes.

Bhutan has a high literacy rate but a very low financial literacy rate which is why people believe that one can earn fantastic returns for doing nothing.

A factor here is also the lack of adequate investment avenues in Bhutan and even if there are avenues like the stock market, real estate, fixed deposits etc. people are not aware enough about them or their long-term benefits.

The success of the pyramid schemes in Bhutan is also possible due to our social structure and how we share information. As a small society, we rather trust what a relative or friend is saying blindly than verify things for ourselves.

The pyramid scheme relies in the trust that people have on each other.

Greed, false hope and a belief that wealth can be made overnight is also what drives these schemes.

The success of these schemes here also betrays a certain degree of innocence of our people and how they are still sheltered from the world out there.

The schemes can also perpetuate as there needs to be better monitoring across agencies.

It should not be left to just Competition and Consumer Affairs Authority but other agencies like the RBP, Local Governments etc. should also be used to tackle these schemes.

The fines and punishment for people at the top spreading and gaining from such schemes should also be made tougher.

These pyramid schemes not only cheats people and takes away their savings but it also drains foreign currency away from the country.

It leads to breakdown of trust among people.

The media also needs to play a bigger role in informing the people against any and all such schemes going on and exposing them for what they truly are.

A sad reality of these schemes is that it often targets the vulnerable and those who can ill afford to lose their savings and so more must be done to protect them.

“The promise of easy money is but a wolf’s trap laid out for sheep seeking taller grass.”
 James Jean-Pierre