The Bank of Thailand has relaxed its debt assistance measures to help entrepreneurs and individual borrowers during the prolonged pandemic.
The Financial Institution Policy Committee on Thursday approved additional debt aid measures and adjusted other rules to better respond to the demands of small and medium-sized enterprises (SMEs) and individual borrowers.
The easing is in response to the continued outbreak and extension of government lockdown measures to contain new infections, said Suwannee Jatsadasak, senior director for regulatory department 2.
The central bank adjusted its soft loan scheme to support liquidity for both existing and new SME borrowers by expanding their credit line.
For new SME borrowers, the bank increased the maximum credit line from 20 million baht to 50 million baht per borrower for loans from any financial institution.
For existing SME borrowers, the central bank will maintain the previous rule allowing a creditor to grant an additional credit line of up to 30% of the existing credit line, but no more than 150 million baht.
If 30% of the existing credit line is below 50 million baht, borrowers are allotted a maximum credit line of 50 million baht each.
Ms Suwannee said the central bank has approved soft loans with a total value of 92.3 billion baht as of Aug 16 this year.
The central bank expects to approve 100 billion baht in soft loans within four months of the amended programme's implementation. It previously expected the full loan approval would take six months.
"If the soft loan approval meets the target of 100 billion baht, we plan to implement a second phase supporting SMEs' liquidity and their business recovery," she said.
In addition, the central bank relaxed debt assistance for retail loans covering credit cards, personal loans and digital personal loans until December 2022.
For credit cards and personal loans, the central bank maintained the minimum debt payment rate at the existing level of 5%.
For credit card and personal loan borrowers whose income is below 30,000 baht per month, the regulator expanded the maximum credit line to no more than two times monthly income because the central bank does not want to limit the number of creditors offering such loans to a borrower, said Ms Suwannee.
For digital personal loans, the central bank expanded the ceiling credit line to 40,000 baht per borrower, and extended the debt instalment period to a maximum of 12 months.
She said the central bank also extended the existing non-performing loan classification and loan-loss reserve regulations to March 31, 2022 and year-end 2023, respectively.
Moreover, the bank extended the lower delivery fee of 0.23% for financial institutions to the Financial Institution Development Fund until the end of 2022.
This move should help ease the burden on financial institutions during the pandemic, said Ms Suwannee.
