Kuwaiti authorities and economic experts have highlighted the growing concern over the practice known as "cash out" or "takyeesh," which involves purchasing electronic devices, particularly smartphones, on credit and quickly reselling them for cash at significantly reduced prices. This practice, classified as an illicit financial activity, violates laws regulating credit and commercial transactions and has been linked to money laundering and fictitious credit schemes.
Economic advisor Abdullah Al-Ghareeb explained that "cash out" has become entrenched in the Kuwaiti market over several years, evolving through complex networks of intermediaries and unlicensed merchants who operate within a shadow banking system. Individuals, often facing financial distress or unable to meet formal credit criteria, obtain high-end devices on installment plans from major telecommunications companies or retailers. They then sell these devices to unlicensed intermediaries or retail outlets for up to 40 percent below market value, receiving immediate cash but incurring long-term debts beyond their repayment capacities.
Experts warn that this cycle undermines the integrity of Kuwait’s financial sector. The practice distorts credit profiles by creating an illusion of financial solvency, which can mislead banks and lead to an increase in non-performing loans and bad debts. Liquidity from these transactions often leaks into unregulated channels, facilitating money laundering and threatening the effectiveness of monetary policy and credit market regulation. Such unmonitored financial flows potentially divert financing away from productive economic activities into speculative or fictitious ventures that harm the national economy.
Economist Mohammad Ramadan acknowledged that while "cash out" may not cause immediate large-scale economic damage, its spread disrupts domestic trade and pricing structures. He noted that the resale of purchased devices below market value creates unfair competition for lawful businesses and harms companies that comply with regulations. This pricing distortion negatively impacts legitimate profits and market stability.
In response, Kuwaiti authorities have launched coordinated efforts to combat the phenomenon. The Ministry of Interior is working closely with the Ministry of Commerce and Industry, the Communications and Information Technology Regulatory Authority (CITRA), and other relevant bodies as part of a broader national campaign to eliminate money laundering and illicit financial activities. Measures include revoking commercial licenses for businesses involved in "cash out" operations, administratively closing fronts facilitating these schemes, tracking suspicious funds, and identifying intermediaries managing these networks.
Legal expert Salem Al-Kandari emphasized the stringent penalties and multilateral enforcement actions being undertaken to address the issue. Authorities are also targeting the promotion of these illicit activities by disabling telephone numbers and digital accounts used by intermediaries. This integrated approach aims to preserve the financial integrity of Kuwait’s commercial sector, protect consumers, and safeguard the broader economy from the adverse effects of such illicit practices.