Credit Cards For Thai Farmers To Be Launched By Nov 1

[webfact]

Credit cards for farmers to be launched by Nov 1

BANGKOK, Sept 9 - The Yingluck government's programme to offer credit cards for farmers will be launched by Nov 1, fulfilling one of the major campaign promises that the Pheu Thai Party pledged to the grassroots that helped it win the July election.

Luck Wajananawat, manager of the Bank for Agriculture and Agricultural Co-operatives (BAAC), on Thursday spoke of the progress being made toward the launch.

The committee set up by the BAAC agreed to contract a credit card system, including equipment, managed by a service provider for three years, with a budget of Bt1 billion. Rental fees have been set at Bt648 billion including issuing 3 million credit cards with a Bt360-million budget.

A 'smart card' system will be used for security authentification.

Techniques, processes for checking transparency, and fiscal control are the main criteria for the appropriate service provider to be selected. Competitors must have scores of at least 80 in order to pass to the next round for their prices to be considered.

This project's management system will include registration, credit cards issuance, partners of contract, credit limits, and debt payment.

According to Mr Luck, the BAAC credit cards in their initial phase will be limited to payment for agricultural production costs from varied cooperatives and over 3,000 stores affiliated with the BAAC nationwide, with the number reaching 5,000 shops in the following years.

The cards will offer a maximum 70 per cent loan limit in accordance with the value of each farmer-debtor's product for sale, while carrying a 7 per cent interest rate, or zero per cent--in case a subsidy is provided by the government.

Other benefits include annual fee exemption, a 30-day interest-free period, free life insurance of no more than Bt100,000, emergency cash loans of Bt10,000, and special interest rates for cash deposits.

Promotions from networked stores cover discounts, point-of-sale collections for gifts or other rewards.

In the second phase, farmers will be able to withdraw cash, make payments along with other services as offered by other service providers.

The BAAC manager said some Bt20 billion is expected in the credit system in the first year, whereas Bt44.6 billion is forecast in the second year, and about Bt70 billion in the third year, respectively. (MCOT online news)

-- TNA 2011-09-09

[looping]

"...a 30-day interest-free period..."

Just wondering what the APR is after this 'honeymoon period', or is that irrelevant?

Don't see this a a long term or even medium term solution, but then are any of these election promise policies?

[katasyd]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

[Ricardo]

Perhaps the credit-card pack might also include an educational-leaflet, explaining the hard facts of what happens if you fail-to-repay the debt on-time, and are left losing up-to-70% of the crop you've just grown, and the other 30% has gone to pay the owner of the land their rent ?

Helping farmers gain access to fertiliser or better-tools is laudable, making it easier for them to take-on debt which they later can't repay is not, credit-cards per-se are not a bad thing but can easily lead the financially-naive into long-term debt or the clutches of the mafia-lenders.

Previous loan-schemes have often gone wrong, and required bailing-out, what will be different this time, apart from having a nice plastic-card ?

[janverbeem]

Perhaps the credit-card pack might also include an educational-leaflet, explaining the hard facts of what happens if you fail-to-repay the debt on-time, and are left losing up-to-70% of the crop you've just grown, and the other 30% has gone to pay the owner of the land their rent ?

Helping farmers gain access to fertiliser or better-tools is laudable, making it easier for them to take-on debt which they later can't repay is not, credit-cards per-se are not a bad thing but can easily lead the financially-naive into long-term debt or the clutches of the mafia-lenders.

Previous loan-schemes have often gone wrong, and required bailing-out, what will be different this time, apart from having a nice plastic-card ?

Ensuring that there are a lot of poor uneducated farmers waving a flag when big brother lands at the airport in a few months.

[siampolee]

The whole scam is nothing more than an elaborate extension by Thaksin , his family and their brown nosing acolytes to lure farmers into debt so as the local loan sharks can snatch more ground as their reward for supporting the P.T.P. ( Personal Thaskin Property) administration.

Yet again the innocents are funding their own debt bondage and enslavement to the new elite who profess sympathy for the ordinary people.

No small wonder that education is feared.,

Edited September 9, 2011 by siampolee

[whybother]

"...a 30-day interest-free period..."

Just wondering what the APR is after this 'honeymoon period', or is that irrelevant?

Don't see this a a long term or even medium term solution, but then are any of these election promise policies?

while carrying a 7 per cent interest rate, or zero per cent--in case a subsidy is provided by the government.

[MILT]

There are no valid arguments to putting these people with little or no experience of the debt world in perpetual debt. I know many rice farmers that will look at this like a dog looking at the Television.

[Moruya]

What a poorly written article

[soundman]

What I find laughable is the cards can only be used in a "closed" shopping network which will have undoubtably be hand picked after private bidding and negotiation, and will sell the products at inflated prices, usually using the excuse of extra charges incurred for processing the credit cards.

Ill-conceived policy IMO.

[sfbandung]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

Yep. Absolutely crazy.

[rakman]

"...a 30-day interest-free period..."

Just wondering what the APR is after this 'honeymoon period', or is that irrelevant?

Don't see this a a long term or even medium term solution, but then are any of these election promise policies?

According to the article, 7% or 0% depending if there is a government subsidy, (or maybe if you voted for PTP).

Any bets how much debt will be "forgiven" and how much will be "lost"?

[nycpal44]

It would not surprise me to read that the suicide rate increased after the Credit Card launch for farmers....

[ThaiOats]

"Our very own credit card! Yay!" is all that the farmers can think of. With little or no prior debt management responsibility and a new "toy" is like having a fat kid at a candy store. 7% seems like a small figure doesn't it? Until it piles up... wonder where the collected interest is going to?

[nycpal44]

"Our very own credit card! Yay!" is all that the farmers can think of. With little or no prior debt management responsibility and a new "toy" is like having a fat kid at a candy store. 7% seems like a small figure doesn't it? Until it piles up... wonder where the collected interest is going to?

That is easy.... the collected interest is going to the Shinawatra Family to compensate them for the seized 46 billion baht of frozen assets

[REM]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

Couldn't have said it better, might be a "democratic" government, but keeping the indentured servitude,, or economic slavery, is just as alive. Funny how the can give them credit cards in a few weeks, but the minimum wage is too difficult. Well guys, be prepared to pay for gf's family credit card soon! I think they're relying on the fact that so many working girls, or girls who are looking for farang are from rural areas!

[hullupullo]

Every home in my village already have big loans in this Baac bank, nothing new. But before, they can buy anything with the money(motosai, laokao, more laokao), now if You read the story, these cards are good only in some shops "will be limited to payment for agricultural production costs from varied cooperatives and over 3,000 stores affiliated with the BAAC nationwide"

I think this is better way now.

[ginjag]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

Same as giving credit cards in the U.K. for jobless and long term unemployed. They cannot pay back and would not know how when the demand is on the doorstep.

[katasyd]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

Couldn't have said it better, might be a "democratic" government, but keeping the indentured servitude,, or economic slavery, is just as alive. Funny how the can give them credit cards in a few weeks, but the minimum wage is too difficult. Well guys, be prepared to pay for gf's family credit card soon! I think they're relying on the fact that so many working girls, or girls who are looking for farang are from rural areas!

It will come time to vote again and these people will be told to vote to remove the debts.

I can imagine the campaign policies now.

"We will clear the government credit card debt if you vote for PTP"

Essentially, the votes have been paid for in advance using government money.

Edited September 9, 2011 by katasyd

[kumsamut]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

Before planting, Thai farmers have no money to buy fertilizers, seeds, or labor. These are elements for farming.

Normally they have to get loans from private sectors for 20% interest and that make them sunk in debt.

No one wants to borrow, the expenses are just there. Please understand.

The fact is that the gov in the past press the prices of the crops down, and that made the poor farmers always poor.

Please try to understand.

[Ricardo]

"...a 30-day interest-free period..."

Just wondering what the APR is after this 'honeymoon period', or is that irrelevant?

Don't see this a a long term or even medium term solution, but then are any of these election promise policies?

while carrying a 7 per cent interest rate, or zero per cent--in case a subsidy is provided by the government.

A quoted 7% might not be the true APR, always read the small-print !

What a poorly written article

Why ? Care to share your criticisms ?

[thaimat]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

The Abhisit govt had a very good program to refinance the high interest debt caused by the previous Sinawatra program of "easy credit" for farmers. Now here comes another Shinawatra plan to put farmers back into debt. A very good way to pick up farms for a song, making it another sad day for Thai farmers, once again.

[overherebc]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

Before planting, Thai farmers have no money to buy fertilizers, seeds, or labor. These are elements for farming.

Normally they have to get loans from private sectors for 20% interest and that make them sunk in debt.

No one wants to borrow, the expenses are just there. Please understand.

The fact is that the gov in the past press the prices of the crops down, and that made the poor farmers always poor.

Please try to understand.

Years ago I offered to give my GF father the cash to buy seed. He refused to take my money on the grounds that he would not be allowed to pay cash, it had to be paid according to the terms set down by the seller.

[OzMick]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

Before planting, Thai farmers have no money to buy fertilizers, seeds, or labor. These are elements for farming.

Normally they have to get loans from private sectors for 20% interest and that make them sunk in debt.

No one wants to borrow, the expenses are just there. Please understand.

The fact is that the gov in the past press the prices of the crops down, and that made the poor farmers always poor.

Please try to understand.

The credit on the card is set at 70% of your crop - that would be your LAST crop, not some pie-in-the-sky estimate of your coming crop. Any farmer with sense should have set aside money from his last crop to pay the costs of the next.

Which government has pressed down crop prices? Every government that I can recall has been paying subsidies on rice, and in doing so props up an inefficient and uneconomic industry - if they don't they won't get re-elected. Working inefficiently in an industry that simply does not offer an economic return per man-hour is what keeps rice farmers poor.

Thailand could have a great rice industry, but a lot of expensive machinery would have to be bought, and 95% of those currently working in it would be unemployed.

[OzMick]

Cards issued from Nov 1 - maxxed out before xmas!

[Emptyset]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

The Abhisit govt had a very good program to refinance the high interest debt caused by the previous Sinawatra program of "easy credit" for farmers. Now here comes another Shinawatra plan to put farmers back into debt. A very good way to pick up farms for a song, making it another sad day for Thai farmers, once again.

Link? Abhisit's govt kept TRT's village fund scheme going didn't he? So he can't have thought it was that bad an idea. The point is that many are already in debt yet still have to buy essentials. Either that or they'll have to go to local loan sharks with all that entails. The credit card will at first be limited to these essentials and should stay that way imo.

[robert00]

Perhaps the credit-card pack might also include an educational-leaflet, explaining the hard facts of what happens if you fail-to-repay the debt on-time, and are left losing up-to-70% of the crop you've just grown, and the other 30% has gone to pay the owner of the land their rent ?

Helping farmers gain access to fertiliser or better-tools is laudable, making it easier for them to take-on debt which they later can't repay is not, credit-cards per-se are not a bad thing but can easily lead the financially-naive into long-term debt or the clutches of the mafia-lenders.

Previous loan-schemes have often gone wrong, and required bailing-out, what will be different this time, apart from having a nice plastic-card ?

You have hit the nail on the head mate.

[astral]

7% seems like a small figure doesn't it? Until it piles up... wonder where the collected interest is going to?

Is that 7% per month, or the APR?

Has no-one learnt from the credit crisis in Europe and the US?

We just cannot go on living on credit

[EarthAlien]

The whole scam is nothing more than an elaborate extension by Thaksin , his family and their brown nosing acolytes to lure farmers into debt so as the local loan sharks can snatch more ground as their reward for supporting the P.T.P. ( Personal Thaskin Property) administration.

Yet again the innocents are funding their own debt bondage and enslavement to the new elite who profess sympathy for the ordinary people.

No small wonder that education is feared.,

Excellent and accurate observation,.. this sums it all up in a nutshell.

"The borrower is slave to the lender" Proverbs 22:7

[drdoom6996]

The Government are not better than the loan sharks.

Load em up with debt, own their souls.

That's the idea. Max out the card. And the bank owns the farm. What a miracle Thailand is.