Majority ineligible for Thailand’s debt relief programme
A significant number of borrowers have registered for the You Fight, We Help debt relief programme one month after its launch. However, a substantial portion of these applicants do not meet the eligibility criteria, as noted by banking officials.
Kris Chantanotoke, Chief Executive of Siam Commercial Bank (SCB), highlighted that some registrants do not qualify for the programme. Consequently, the bank has refined its communication strategies to better reach its target demographic.
The bank has adjusted operations to address issues encountered during the programme’s initial month. More time is required to assess its effectiveness fully but the bank is dedicated to aiding vulnerable clients in resolving their debts through the scheme.
Data from the Bank of Thailand indicates that 461,029 individuals registered for the debt relief scheme, with 220,296 loan accounts gaining approval.
The initiative permits eligible borrowers to suspend interest payments for three years and reduce monthly debt instalments through a step-up repayment plan.
These measures, supported by regulatory agencies and financial institutions, aim to mitigate Thailand’s household debt crisis. In the third quarter of the previous year, the household debt-to-GDP ratio was approximately 90%.
The You Fight, We Help scheme received Cabinet approval on December 12, 2024, and is accessible to borrowers with debts overdue for up to one year. It covers mortgages up to 5 million baht, car loans up to 800,000 baht, and small business loans up to 5 million baht.
Eligible participants must have incurred debt before January 1, 2024, with repayment defaults ranging from 30 to 356 days. Borrowers involved in previous debt restructuring programmes from January 1, 2023, who defaulted on repayments for no more than 30 days, also qualify.
Sakchai Peechapat, Chief Executive of Tisco Financial Group, reported that 7,000 to 8,000 customers applied for the programme, but only 30% met the qualifications. Some of these registrants were approved for the scheme.
Aphinant Klewpatinond, Chief Executive of Kiatnakin Phatra Financial Group (KKP), noted that around 50% of registrants did not meet the eligibility criteria. Many misunderstood the programme’s conditions, particularly concerning the debt default period.
The bank intends to clarify these conditions and continue with standard debt collection processes, reported Bangkok Post.
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