GSB to set aside 20 billion baht loan to ease plight of low income earners from loan sharks

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GSB to set aside 20 billion baht loan to ease plight of low income earners from loan sharks



BANGKOK: -- In another effort to help low income earners heavily indebted with loan sharks, the Government Savings Bank (GSB) says it is setting aside 20 billion baht to help solve the problem of informal or unregulated loans.

GSB says it will be launching a campaign to promote greater fairness and equity from these loan providers.

GSB director Chatchai Payuhanaveechai said that in accordance with the government’s plans to solve the longstanding problem of unregulated or informal debt, the bank will be allocating a budget of 20 billion baht to help in the effort.

The majority of this money will go to providing low interest loans to low income earners who are in debt.

He said he plan is to have people who are deep in debt to make initial applications with either the Government Savings Bank or the Bank for Agriculture and Agriculture Cooperatives before their names are officially handed in for approval by rural enterprise networks, rural cooperatives or rural village administrations.

More importantly, the bank also has plans to launch an effort to attract providers of unregulated or unofficial loans to enter into a campaign whereby they adopt a more humane and fair attitude towards debtors.

Accordingly, the Ministry of Finance is currently studying the possibility to introducing laws which will force loan providers to provide loans with low interests.

A recent study indicated that under the program, of the approximately 1.3 million people who are in debt with informal or unregulated loans, around half will pass official screening.

This will amount to around 600,000 – 700,000 individuals who will be provided with 50,000 baht aid each which will amount to between 30 to 40 billion baht in total.

He said the Bank for Agriculture and Agricultural Cooperatives will handle cases involving farmers while the remainder will be looked after by the GSB.

Significantly, low monthly interests of between 0.75–1% will be charged which on average amounts to only 2,000 baht a month.

Source: http://englishnews.thaipbs.or.th/content/163013


-- Thai PBS 2016-05-12

[EricBerg]

Thailand is great at making unannounced instant new laws.

Can't they make a law against the "loansharking"?Then arrest the baddies and drop all their loans? No need to reserve the 20 billion then? Or are those loansharks too well connected perhaps?

[craigt3365]

How about cracking down on the illegal money lenders? Oops...forgot, they already announced they'd do this. Many times...

[NongKhaiKid]

A couple of years back didn't a provincial governor personally negotiate with a major loan shark over a the problems of a female debtor on the point on suicide ?

[clockman]

Thais, will not grasp the nettle. On any problem. Always the easy way. Infinitum

[laolover88]

So they are proposing to lend more money to people who owe money.

Is Loan Sharking an occupation "reserved" for Thai people?

If not I might dabble!!

'

[ChrisY1]

More free money......never ceases to amaze that over and over again, the free money just keeps on rolling out....do they just keep printing this stuff or what?......

[worgeordie]

Helping people in debt again,it's going to change nothing,as they will just

get into more debt,while people who work hard,budget their income,maybe

save a little,are the ones been penalised,with interest rates that don't even

cover inflation,

regards worgeordie

[Krataiboy]

According to a recent survey, nearly 90 per cent of working families are "heavily" in debt. Hands up all those who think that offering cheap loans to people who habitually spend more than they earn is going to make this situation better.

[phoenixdoglover]

So they are proposing to lend more money to people who owe money.

Is Loan Sharking an occupation "reserved" for Thai people?

If not I might dabble!!

Moreover, by giving money to people in debt to loan sharks, those people will surely do the following:

1. Repay their loans from the loan sharks...effectively passing on a government subsidy to the loan sharks

and/or

2. Use the government money for something else, compounding their debt problem

[SOTIRIOS]

........duhh....

...why not simply arrest all the loan sharks....???

...does it make sense to pay criminals....???

...jeez....

...they know exactly who they are....

[whatproblem]

Instead of these people paying up to 10 % a month they can loan from the bank and pay 1 % ,course it will help them

[phoenixdoglover]

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[wabothai]

Seems to me this is playing in the hands of the sharks. Not stopping it at all.

They ought to be treated as criminals of the worst kind.

[Srikcir]

around 600,000 – 700,000 individuals who will be provided with 50,000 baht aid each which will amount to between 30 to 40 billion baht in total

Never ending off-budget fundings (aka deficit spendng) that is paid by government debt. it's no wonder that the Prayut government has suffered a 500 billion baht budget deficit for only the first six months (October 2015-March 2016) of the FY 2016 budget. How much debt will he add in the second half of the fiscal year, another 500 billion baht?

I doubt any elected Thai government could cause so much national debt and survive a vote of confidence. Of course Prayut isn't subject to any vote of confidence to remain in power.

[phoenixdoglover]

around 600,000 – 700,000 individuals who will be provided with 50,000 baht aid each which will amount to between 30 to 40 billion baht in total

Never ending off-budget fundings (aka deficit spendng) that is paid by government debt. it's no wonder that the Prayut government has suffered a 500 billion baht budget deficit for only the first six months (October 2015-March 2016) of the FY 2016 budget. How much debt will he add in the second half of the fiscal year, another 500 billion baht?

I doubt any elected Thai government could cause so much national debt and survive a vote of confidence. Of course Prayut isn't subject to any vote of confidence to remain in power.

It is a startling contrast between Thailand and some other places, where government revenues, expenditures, deficits and debt trends, are constant topics in the press and have inspired strong political movements.

In Thailand? It must be that whole mai phen rai thing. Or, the government is not as transparent as we have been led to believe.