New debt relief scheme aids nearly 500,000 Thai debtors
Deputy Finance Minister Phaophum Rojanasakul announced that as of January 28, the You Fight, We Help initiative has received interest from 497,552 debtors, covering 576,496 accounts. The scheme aims to assist individual debtors and includes two measures, excluding direct registration with financial institutions.
The first measure, Direct Payment, Asset Retention, targets home, car, and small SME loans with modest limits, ensuring that debtors can retain essential assets for living and working. For home loans, the cap is 5 million baht, car loans are capped at 800,000 baht, motorcycle loans at 50,000 baht, and SME loans at 5 million baht.
This measure restructures the debt, reducing instalments to 50% in the first year, 70% in the second year, and 90% in the third year. Additionally, interest burden suspension is offered for three years, with instalments going directly towards the principal. Interest during this period is waived under specific conditions.
The second measure, Pay, Close, Conclude, offers relief for individual debtors with non-performing loans (NPLs) with outstanding balances not exceeding 5,000 baht. This involves restructuring the debt, allowing debtors to settle by paying only 10% of the outstanding balance to close the debt immediately, reported KhaoSod.
Interested individuals can apply through the Bank of Thailand’s registration system at www.bot.or.th/khunsoo or contact participating financial institutions until February 28.
To support these measures, the government has reduced the annual contribution rate that banks pay to the Financial Institutions Development Fund from 0.46% to 0.23% of their deposits for three years, enabling banks to better assist debtors.
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.
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