Grease money is a payment made to officials to expedite paperwork, known as a fat or facilitation payment. Its legality varies depending on the laws governing the officer and the person offering the payment. Fat payments are more common in developing countries and can be considered a form of bribery. Opponents argue that it promotes unfair competition and questionable business practices.
Grease money is money that is paid to an official to facilitate the rapid processing of paperwork. Such a payment is known as a fat or facilitation payment, and the legality of such payments varies depending on the laws governing the activities of the officer and the person or company offering the payment. Some people consider these payments to be a form of bribery, as they involve offering money to a public official with the expectation of an outcome, while others argue that they are only used to expedite a task that will be performed anyway, whether or not the whether or not funds are offered. As such, it’s simply a cost of doing business in some parts of the world.
As a general rule, an official is offered a penny to expedite the process of what is known as a “non-discretionary task.” In other words, the task will eventually get done, because it’s part of the officer’s job description, but the process could be dragged out over a period of weeks or even months. Payment is offered to expedite the process.
Fat payments are more common in developing countries, where civil servants are often paid minimum wages, forcing them to rely on this money to make a living. In a classic example, someone seeking a travel visa might offer more than the normal visa application fee to expedite the application, ensuring that she is ready for travel in time. These payments are also used to clear customs and a variety of other bureaucratic tasks.
In some countries, companies are specifically prohibited from offering fat money, both at home and abroad. In other regions, these payments are considered acceptable and may even be tax-deductible, as a business expense. However, taking this action can be a very slippery slope and it is easy to cross the bribery line given the nature of such payments.
Opponents of fat money argue that it promotes unfair competition, as people and businesses without excess funds cannot offer payments and, as a result, may find themselves unable to perform basic bureaucratic tasks in some regions of the world. Such payments also promote questionable business practices, making it easier for unscrupulous people to cross the line into shadier deals. Solicitations for money can also ultimately harm a country by driving away foreign investors who frown on such practices.
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