Central bank issues debt relief measure to slash Thais’ interest burden

[rooster59]

Central bank issues debt relief measure to slash Thais’ interest burden

By The Nation

 

Thanyanit Niyomkarn, assistant central bank governor

 

The Bank of Thailand on Thursday issued a new debt relief measure aimed at reducing Thais’ interest rate burden from 16-25 per cent to 5.5-8.8 per cent.

 

 

The debt consolidation measure will allow borrowers to bundle their credit card, personal and mortgage loans into one sum, Thanyanit Niyomkarn, assistant central bank governor said on Thursday (August 27).

 

Borrowers can then utilise collateral in their mortgage loans to restructure their debt total with financial institutions.

 

Borrowers usually pay between 16 and 25 per cent for personal loans, but the new debt restructuring measure will cut this to the minimum retail rate (MRR) of 5.75 to 8.8 per cent, she said.

 

Debtors will be also allowed to extend their debt payment period, said Thanyanit.

 

The measure is free of charge and will not damage their credit rating, she assured.

The move comes after the central bank, financial institutions and state-run banks shared concerns about economic recovery amid the Covid-19 fallout. Many businesses are yet to resume normal operations, hitting workers’ income, Thanyanit  noted.

 

Retail borrowers can apply for the debt relief measure via banks from September 1 this year to December 31, 2021.

 

Source: https://www.nationthailand.com/business/30393628

 

-- © Copyright The Nation Thailand 2020-08-29

 

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[RichardColeman]

Sounds more to me like the banks wanting you to put all your other debt on an asset they can eventually take 

[hotchilli]

Put all your debt into one pot, still has to be re-payed at some point.. or lose what you had to put up as a guarantee.

[Cake Monster]

3 hours ago, RichardColeman said:

Sounds more to me like the banks wanting you to put all your other debt on an asset they can eventually take 

Its the Banks trying to claw back Loans that have gone delinquent.

Many of these Loans will have had no asset value to them, but by consolidation there is some small hope of an asset seizure when the restructured Loans go bad, ... as they will.

Only a very few of these restructured Loans will make good, the vast majority will end up bad NPL

[digger70]

10 hours ago, rooster59 said:

Debtors will be also allowed to extend their debt payment period, said Thanyanit.

That just means they will pay more in the long run.

[Leaver]

6 hours ago, Cake Monster said:

Its the Banks trying to claw back Loans that have gone delinquent.

Correct, and they better start growing longer claws.  They will need to.