Debt peonage

Debt bondage, also known as debt slavery or bonded labour, is a person's pledge of labour or services as security for the repayment for a debt or other obligation. The services required to repay the debt may be undefined, and the services' duration may be undefined. Debt bondage can be passed on from generation to generation.

Currently, debt bondage is the most common method of enslavement with an estimated 8.1 million people bonded to labour illegally as cited by the International Labour Organization in 2005. Debt bondage has been described by the United Nations as a form of "modern day slavery" and the Supplementary Convention on the Abolition of Slavery seeks to abolish the practice. Though most countries in South Asia and Sub-Saharan Africa are parties to the Convention, the practice is still prevalent primarily in these regions. It is predicted that 84 to 88% of the bonded labourers in the world are in South Asia. Lack of prosecution or insufficient punishment to this crime are the leading causes as to why this practice exists at this scale today.

Though the Forced Labour Convention of 1930 by the International Labour Organization, which included 187 parties, sought to bring organized attention to eradicating slavery through forms of forced labor, formal opposition to debt bondage in particular came at the Supplementary Convention on the Abolition of Slavery in 1956. The convention in 1956 defined debt bondage under Article 1, section (a):

"Debt bondage, that is to say, the status or condition arising from a pledge by a debtor of his personal services or of those of a person under his control as security for a debt if the value of those services as reasonably assessed is not applied towards the liquidation of the debt or the length and nature of those services are not respectively limited and defined;"

When a pledge to provide services to pay off debt is made by an individual, the employer often illegally inflates interest rates at an unreasonable amount, making it impossible for the individual to leave bonded labor. When the bonded laborer dies, debts are often passed on to children.

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