Lite Beer Posted July 14, 2014 Share Posted July 14, 2014 GSB to propose military junta set up a fund to save poor people from loan sharks BANGKOK: -- The Government Savings Bank (GSB) is to propose the National Council for Peace and Order (NCPO) to set up a funding of around 20 to 30 billion baht to help solve the problem of informal loans or loan sharks. GSB acting president Thatchapol Karnchanakul said that the bank would present the idea of the fund to the NCPO’s chief of economic affairs Air Chief Marshal Prajin Juntong this coming Thursday, as the problem of loan sharks loans has become more severe.He said that household loans now stand at around 9.8 trillion baht, which is accounted for approximately 82 percent of the country’s total GDP of 11 trillion baht.The acting president said the interest rates for informal loans are usually very high, prompting the bank to ask the NCPO l to consider setting up the fund worth 20-30 billion baht to solve the problem of informal loans.He said the sum should be collected from the state’s special finance institutions or be compensated by the government, so as to be used in paying off the informal loans.He said each debtor to the loan sharks would have to undergo an inspection to verify that their loans are valid before the government would pay off their debts and enter them into the funding programme, in which they would be paying back the money with an interest rate of less than one percent a month.For a long term solution, he suggested that an office be established or the Finance Ministry’s Fiscal Policy Office (FPO) be in charge in taking care of informal loans by setting up clear cut regulations on the matter.He added that talks with concerned agencies must be held soon, in order to seriously solve the problem as requested by the NCPO. Source: http://englishnews.thaipbs.or.th/gsb-propose-military-junta-set-fund-save-poor-people-loan-sharks/?utm_source=rss&utm_medium=rss&utm_campaign=gsb-propose-military-junta-set-fund-save-poor-people-loan-sharks -- Thai PBS 2014-07-14 Link to comment Share on other sites More sharing options...
clockman Posted July 14, 2014 Share Posted July 14, 2014 Hope they help, loan sharks are in every village. Big problems, Link to comment Share on other sites More sharing options...
Popular Post NeverSure Posted July 14, 2014 Popular Post Share Posted July 14, 2014 (edited) Why don't they just throw the loan sharks and their goons in prison? What's up with bailing them out? The way to help the people who are trapped by loan sharks is to cut the sharks off at the knees, not help them get paid. Why don't they treat the sharks like drug dealers? I really don't get using government money to pay these azwipes off. This is a loan shark bailout. Does someone have "friends?" Edited July 14, 2014 by NeverSure 4 Link to comment Share on other sites More sharing options...
Popular Post englishoak Posted July 14, 2014 Popular Post Share Posted July 14, 2014 (edited) Sooo lets get this straight, the idea is to pay off the loan sharks for these people that cant afford it ? So that pays the mafia off and then what will the people that get bailed out from the sharks do, other than go right back and get another loan from somewhere... possibly the same sharks again having now got a clean slate and having no way to get a loan from other channels, like the state ? Cut out the middleman rather than what seems to me like a great bailout for both the sharks and the poor. This isnt pro active but reactive and will have no lasting effect other than to keep the sharks paid off... Heres an idea, why not if they want to help, just set up a loan program that lends direct to the poor at rates far lower than the loan sharks do and put the sharks right out of business or get street rates dropping if the sharks wish to compete. Edited July 14, 2014 by englishoak 3 Link to comment Share on other sites More sharing options...
Popular Post Tokay Posted July 14, 2014 Popular Post Share Posted July 14, 2014 How about trying to educate these people and teach them basic economics. Or... or... stop playing cards and losing all your money. 4 Link to comment Share on other sites More sharing options...
Popular Post noitom Posted July 14, 2014 Popular Post Share Posted July 14, 2014 So he seems to be proposing that the Thai military dictatorship pay off these "informal loans" a euphemism for loan shark's juice. This guy should be examined immediately to determine his alignments and activities in the past. The Thai military dictatorship should not fall for this con. They should be busting the loan shark network and their backers and launderers. 4 Link to comment Share on other sites More sharing options...
BSJ Posted July 14, 2014 Share Posted July 14, 2014 Round up the loan sharks and lock them up in cell Block 'A'. No trial, just confiscate all their assets and give em 10 years in the sin bin for being a criminal predator. Then when they find people who have borrowed money from new loan sharks, put the new loan sharks in Cell Bock 'B' and the borrowers in Cell Block 'C'....but only for a year. Once a day they get rice and fish head soup to eat. No visitors, no mobile phones and no mingling with other prisoners. 1 Link to comment Share on other sites More sharing options...
siampolee Posted July 14, 2014 Share Posted July 14, 2014 Sadly this evil debt enslaving flourishing industry of usury is not confined to Thailand alone, Payday loans abound in the U.K. at extortionate rates of interest and dubious practices.However there has at last been some government action in the U.K to tame this monster. Sadly though due to human fraility and vunerability and greed this situation is going to be difficult to control. Financial stability and money management techniques need to be and must be taught at school and even in the workplace so as to enlighten people in the ways to mange their incomes. Link to comment Share on other sites More sharing options...
Popular Post ezzra Posted July 15, 2014 Popular Post Share Posted July 15, 2014 Loan sharking is here to stay, it has exited since the day money was invented... You can't save the poor, there will always be poor people, what are you gonna do? throw more billions at the poor people only for then to run out and buy new motorcycles, pickups and smart phones? the question is, who will save the junta from the poor? 3 Link to comment Share on other sites More sharing options...
Seastallion Posted July 15, 2014 Share Posted July 15, 2014 (edited) The idea sounds nice until you consider that many of the smaller loans (under 100 000) are at extortionate rates because they are unsecured. What the GSB is proposing is put millions of tax dollars bhat at risk. He is not prepared to have the bank take this risk. What is needed is a slower approach; Educate how to budget and how to calculate if you can afford a loan, and what happens when you get into the downward spiral trap of borrowing from Peter to pay Paul. Edited July 15, 2014 by Seastallion Link to comment Share on other sites More sharing options...
chainarong Posted July 15, 2014 Share Posted July 15, 2014 <script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script> Why don't they just throw the loan sharks and their goons in prison? What's up with bailing them out? The way to help the people who are trapped by loan sharks is to cut the sharks off at the knees, not help them get paid. Why don't they treat the sharks like drug dealers? I really don't get using government money to pay these azwipes off. This is a loan shark bailout. Does someone have "friends?" Anyone who loans money should be registered and meet a ridged requirement. 1 Link to comment Share on other sites More sharing options...
chainarong Posted July 15, 2014 Share Posted July 15, 2014 <script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script> Sadly this evil debt enslaving flourishing industry of usury is not confined to Thailand alone, Payday loans abound in the U.K. at extortionate rates of interest and dubious practices.However there has at last been some government action in the U.K to tame this monster. Sadly though due to human fraility and vunerability and greed this situation is going to be difficult to control. Financial stability and money management techniques need to be and must be taught at school and even in the workplace so as to enlighten people in the ways to mange their incomes. Those Payday loans where drummed out of OZ long ago Link to comment Share on other sites More sharing options...
Kent1 Posted July 15, 2014 Share Posted July 15, 2014 If they lockup the sharks thailand want have a police force. 1 Link to comment Share on other sites More sharing options...
TallGuyJohninBKK Posted July 15, 2014 Share Posted July 15, 2014 This strikes me as a singularly bad idea, for all the reasons others have mentioned above. I hope the NCPO doesn't end up supporting this proposal by GSB. Besides which, if GSB is suggesting less than 1% per month, that's still approaching 12% interest per year, which would be a tidy earner for the bank (although, below the standard 18 or so % p.a. that Thai banks usually charge for credit card debit. Link to comment Share on other sites More sharing options...
siampolee Posted July 15, 2014 Share Posted July 15, 2014 (edited) Tall GuyJohninBKK post # 14. This strikes me as a singularly bad idea, for all the reasons others have mentioned above. I hope the NCPO doesn't end up supporting this proposal by GSB. Besides which, if GSB is suggesting less than 1% per month, that's still approaching 12% interest per year, which would be a tidy earner for the bank (although, below the standard 18 or so % p.a. that Thai banks usually charge for credit card debit. Besides which, if GSB is suggesting less than 1% per month, that's still approaching 12% interest per year, which would be a tidy earner for the bank (although, below the standard 18 or so % p.a. that Thai banks usually charge for credit card debit. Which is a darn sight more manageable and palatable than 20% per month i.e. 240% per annum which is then compoubded by these loan sharks, missed payments also incur further penalities. No wonder children are sold into the sex industry or forced to work in said industry and drug running and dealing is a growing industry. Any way to minimise the impact of the loan sharks is a step forward. As an aside I'm all ''liked out'' at the moment so I can't like posts currently. However ''I like'' will return. Edited July 15, 2014 by siampolee Link to comment Share on other sites More sharing options...
dinger Posted July 15, 2014 Share Posted July 15, 2014 He states that household loans stand at 9.8 trillion baht, which amounts to 82% of the countries GDP of 11 trillion baht, where in the world did he come up with those numbers? Link to comment Share on other sites More sharing options...
klauskunkel Posted July 15, 2014 Share Posted July 15, 2014 GSB to propose military junta set up a fund to subsidize loan sharks - another way to look at it Link to comment Share on other sites More sharing options...
rickirs Posted July 15, 2014 Share Posted July 15, 2014 "the sum should be collected from the state’s special finance institutions or be compensated by the government" aka Add more government debt. Funds for the Junta don't come from the Junta, they come from the government treasury that is replenished through revenue (ie., VAT and income taxes, fees) and/or loans (ie., Treasury bonds). You don't just snap your fingers to create a fund. If the root of the problem is illegal high interest loan sharks, get rid of the sharks. But replacing sharks with government guaranteed high or subsidized low interest loans from banks is no solution (and sanctions a populist policy-evil !). No, the root of the problem is below subsistence income. Focus needs to be on raising the standard of living for Thais through increased employment opportunities, education, reduction of household debt, lower cost of living through strategic policies, etc. But falling into the Wimpy trap ("I'll gladly pay you Tuesday for a hamburger today") is not the answer. Link to comment Share on other sites More sharing options...
monkeycountry Posted July 15, 2014 Share Posted July 15, 2014 Many people in Thailand do not care about their credit worthiness with banks and the government. Hence they will borrow as much as they can from anyone willing, at any interest rate available. When it comes time to pay, they simply don't. Sure, they will not be able to get any future loans, so they just turn back to the loan sharks, and nothing has changed. Except that whatever money the government / banks lent them has now become a gift instead of a loan. So in short, it will effectively be a gift program, not a loan program, and nothing will change, as once the gift has been spent, people will go back to borrowing from the loan sharks. 1 Link to comment Share on other sites More sharing options...
monkeycountry Posted July 15, 2014 Share Posted July 15, 2014 The idea sounds nice until you consider that many of the smaller loans (under 100 000) are at extortionate rates because they are unsecured. What the GSB is proposing is put millions of tax dollars bhat at risk. He is not prepared to have the bank take this risk. What is needed is a slower approach; Educate how to budget and how to calculate if you can afford a loan, and what happens when you get into the downward spiral trap of borrowing from Peter to pay Paul. In a 100% government owned bank the banks money and the tax payers money is one and the same, hence when the bank takes any risks, they are taking such risk on behalf of the tax payers. In other words, it does not matter who takes the risk in this case, it will be tax payer money no matter what. Link to comment Share on other sites More sharing options...
monkeycountry Posted July 15, 2014 Share Posted July 15, 2014 This strikes me as a singularly bad idea, for all the reasons others have mentioned above. I hope the NCPO doesn't end up supporting this proposal by GSB. Besides which, if GSB is suggesting less than 1% per month, that's still approaching 12% interest per year, which would be a tidy earner for the bank (although, below the standard 18 or so % p.a. that Thai banks usually charge for credit card debit. The majority of the loans will not be paid back, so it will not be an earner for anyone but the loan sharks, who will not only get paid, but will also have their clients obtain new loans almost immediately after paying the previous loan with tax payer money. Eventually the government will "forget" the loans, as they have done before. 1 Link to comment Share on other sites More sharing options...
Chris Lawrence Posted July 15, 2014 Share Posted July 15, 2014 Are they going to put the cart before the horse? Need to regulate money lending first?get rid of the loan shark business? What are the interest rates and will they have interest free loans? Lending criteria? Or can I pay my gambling debt? Set up NGO's to deal with financial management, maybe teach children financial literacy at school level? Look at what people are borrowing extra money for? Establish programs that will create wealth; have the community involved in this process. Its like a lot of ideas that are coming out of the NCPO, sound great, but how will they be maintained? This is one program if still going in 3-5 years may be the next big scandal of its time. Imagine the 20-30 billion baht paying off the loans of the elite, with the loan to the Government never being paid back. Devil is in the detail on this one. Agree with Seastallion post and Klaus also put a slant on what could happen. Good luck Link to comment Share on other sites More sharing options...
Bosse137 Posted July 15, 2014 Share Posted July 15, 2014 you can try to educate people as much as you want,but they will not listen to a single word you say!When they decid that they want to have as nice car as the next door family,that is what they fokus on.What will happen when the time comes for paying some of the loan,that is tomorrows problem... I was here,when it was popular to borrow some 200000 thousand in order to go to Taiwan or south Korea and work.No matter how I detailed for them,that the cost for the loan,with interests,would make it a loss to go,they still did it.And came home broke,most of them.To add to the experience,many found that their wife gambeled away the money.Or leant to a relative,who could not repay it.Or even split with another man! As some posters already have said;they borrow at any occasion;never worry about repayment!And,as also said,using it for things they do not need. 1 Link to comment Share on other sites More sharing options...
Eric Loh Posted July 15, 2014 Share Posted July 15, 2014 Sooo lets get this straight, the idea is to pay off the loan sharks for these people that cant afford it ? So that pays the mafia off and then what will the people that get bailed out from the sharks do, other than go right back and get another loan from somewhere... possibly the same sharks again having now got a clean slate and having no way to get a loan from other channels, like the state ? Cut out the middleman rather than what seems to me like a great bailout for both the sharks and the poor. This isnt pro active but reactive and will have no lasting effect other than to keep the sharks paid off... Heres an idea, why not if they want to help, just set up a loan program that lends direct to the poor at rates far lower than the loan sharks do and put the sharks right out of business or get street rates dropping if the sharks wish to compete. Loan program that lends directly o the poor at low rates; like micro credit? Already there call the Village Fund. Link to comment Share on other sites More sharing options...
englishoak Posted July 15, 2014 Share Posted July 15, 2014 Sooo lets get this straight, the idea is to pay off the loan sharks for these people that cant afford it ? So that pays the mafia off and then what will the people that get bailed out from the sharks do, other than go right back and get another loan from somewhere... possibly the same sharks again having now got a clean slate and having no way to get a loan from other channels, like the state ? Cut out the middleman rather than what seems to me like a great bailout for both the sharks and the poor. This isnt pro active but reactive and will have no lasting effect other than to keep the sharks paid off... Heres an idea, why not if they want to help, just set up a loan program that lends direct to the poor at rates far lower than the loan sharks do and put the sharks right out of business or get street rates dropping if the sharks wish to compete. Loan program that lends directly o the poor at low rates; like micro credit? Already there call the Village Fund. Exactly then extend it to more than village its not rocket science and would put the sharks out of business if they so wished Link to comment Share on other sites More sharing options...
bushwacker Posted July 16, 2014 Share Posted July 16, 2014 One of the local loan shark enforcers here is a policeman. I'm thinking ... not an easy fix. Link to comment Share on other sites More sharing options...
myluckythai Posted July 16, 2014 Share Posted July 16, 2014 I want a loan at 1% interest too. Where can i subscribe? Link to comment Share on other sites More sharing options...
myluckythai Posted July 16, 2014 Share Posted July 16, 2014 I want a loan at 1% interest too. Where can i subscribe? Link to comment Share on other sites More sharing options...
myluckythai Posted July 16, 2014 Share Posted July 16, 2014 Oh that's 1 % a MONTH... misread ok cancel my subscription.. Link to comment Share on other sites More sharing options...
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