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2 emergency decrees provide businesses financial help

Neill Fronde



PHOTO: 2 Decrees aim for financial relief for struggling businesses

Thailand enacted 2 new emergency decrees today aimed at providing assistance to businesses and reducing default interest rates to help people affected by Covid-19. A deputy government spokeswoman confirmed the needed action was critical to protect and aid entrepreneurs and small and medium-sized enterprises during the time of pandemic-driven economic crisis.

The goal was to combat unfair interest rates on debt many are suffering, and to provide loans to help keep businesses afloat as the end of the Coronavirus is nowhere in sight.

The Emergency Decree on the Provision of Financial Assistance for Entrepreneurs Affected By the Covid-19 Pandemic allocates 250 billion baht in loans for businesses to recover from the devastating economic effects of the global pandemic. 100 billion baht of this is specifically set aside for those businesses in debt to participate in asset warehousing or debt repurchasing plans.

Asset warehousing allows businesses, like hotels, to essentially store their property in the care of a creditor for a fee until the economy recovers enough to take over the property again and start making money with it again. Debt repurchasing is a process for a business to buy back its own debt with better terms or a lower rate with the purchase price considered a payment to the principal debt not the interest, similar to refinancing a home.

The second of the emergency decrees, an amendment to the Civil and Commercial Code, looks to close loopholes caused by ambiguity in the law that allowed predatory creditors to charge unreasonable interest rates.

If someone missed a loan payment, the original law did not set a default rate, so lenders could charge additional interest. Debtors can now base default rate calculations on the unpaid principal in the updated law. The new decree sets a 3% yearly interest rate and lowers the default rate to 5% a year from the originally 7.5%. The Finance Ministry declared interest rates would be revised every 3 years.

SOURCE: Bangkok Post


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  1. Avatar


    Monday, April 12, 2021 at 10:58 pm

    This article is sourced from the Bangkok Post. Most of it is “verbatim”.

    Fine, I don’t have a problem with that – that’s what journalism is largely about these days.

    BUT for God’s sake, why do you have to change the spelling of “principal debt” (correctly spelt in the Bangkok Post article) to “principle debt” (incorrectly spelt, here)??? The words “principal” and “principle” have ENTIRELY different meanings and different roots. Nobody is checking for elementary mistakes in these articles, eg spelling or punctuation, let alone factual errors.

  2. Avatar


    Tuesday, April 13, 2021 at 1:17 pm

    Great. Thanks for making the correction.

  3. Avatar

    Amy Sukwan

    Saturday, April 17, 2021 at 8:47 am

    Glad you caught that…my guess is the banks will up owning the hotels similar to what happened with houses in America during the Great Financial Crisis. I long ago lost optimism for Thailand going “back to normal” anytime in the foreseeable future. And to repay debt with a crying interest, you actually need better than the baseline in 2019. Good luck with that…

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Neill is a journalist from the United States with 10 years broadcasting experience and national news and magazine publications. He graduated with a degree in journalism and communications from the University of California and has been living in Thailand since 2014.

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