Report Thailand's Household Debt Soars to 16.42 Trillion Baht with Rising Risks

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Thailand's household debt hit a staggering 16.42 trillion baht in the fourth quarter of 2024, as reported by the National Economic and Social Development Council (NESDC). The report, shared on Monday, reveals that more than half of the population holds less than six months' worth of emergency savings, highlighting significant financial vulnerability.

 

Danucha Pichayanan, NESDC's secretary-general, noted in the Q1 2025 economic report that Thai consumers exhibit a marked tendency towards luxury spending. This consumer behaviour raises concerns about excessive debt accumulation, as people seek social acceptance and status through purchasing luxury goods and premium services.

 

Research from Mahidol University in 2024 underscores this trend, showing that one in three Thais prefers spending on luxury items like high-end food, beverages, concert tickets, beauty treatments, and collectibles. Men are particularly inclined towards high-end technology purchases, whereas women tend to spend more on premium food and beverages. This spending behaviour contributes to financial strain and potential debt escalation, especially for those lacking robust financial literacy and planning.

 

In Q4 2024, household debt rose slightly by 0.2%, reflecting tighter lending criteria among commercial banks that have been progressively reducing loan approvals. However, the household debt-to-GDP ratio modestly declined to 88.4% from 88.9% in the previous quarter, as stringent lending conditions curtailed borrowing.

 

The report indicates a slowdown in property loans, which saw a growth of just 2.3%, down from 2.5% in the prior quarter, signifying weakened purchasing power among consumers. Similarly, personal loans and regulated personal loans grew by 3.9% and 1.4%, respectively, both slower than in previous quarters.

 

In contrast, auto loans contracted sharply by 9.6%, attributed to declining car and motorcycle sales, while credit card loans and business loans decreased by 3.4% and 0.3% year-on-year, respectively.

 

Credit quality also deteriorated, with non-performing loans (NPLs) over 90 days past due reaching 1.22 trillion baht in Q4 2024, an increase of 16.4% from the previous year. These NPLs represent 8.94% of total loans, marking a concerning upward trend for the fourth consecutive quarter. Car leasing and commercial loans, including those for small businesses, exhibited particularly high NPL ratios of 27.25% and 22.02%, respectively.

 

Conversely, the NPL ratio for housing, credit card, and agricultural loans showed improvement, while personal loan defaults remained steady at 10.77%. Regarding loans overdue by 30-90 days, known as special mention loans (SMLs), the total value decreased by 6.9% to 568 billion baht, marking a positive downturn for two consecutive quarters despite increases in SML ratios for housing and commercial loans.

 

Given these challenges, authorities may need to bolster debt restructuring initiatives. Programs like "You Fight, We Help" are already in place to assist those struggling with debt management and promote financial stability moving forward.

 

  Adapted by ASEAN Now from The Nation 2025-06-09

 

 

[whiteman]

Maybe the sky is falling after all

[NorthernRyland]

Debt is so insidious. The more debt in the system the higher people can raise prices in order to match the levels of debt. Housing is now more expensive than it should be  and the winners are the banks and the property owners/developers.

[ikke1959]

Please more holidays and more pushing to spend your money with tax incentives and more.. buy now pay later ... show your luxury even if you don't have money... and see what is happening... No investment in education how to deal withy your wage and money, no good registration to prevent that people borrow more than they can pay back, no.. the elite and officials who owns the companies must make profits at all costs