Thailand: Credit guarantee extension urged

  • Business leaders are urging an extension of credit guarantees provided to small and medium-sized enterprises (SMEs) under the 500-billion-baht soft loan scheme, expanding from two years to 10 years to assist them.
  • An extended credit guarantee period by the Thai Credit Guarantee Corporation (TCG) will help support liquidity of SMEs affected by the pandemic, said Payong Srivanich, chairman of the Thai Bankers’ Association, during Wednesday’s meeting of the Joint Standing Committee on Commerce, Industry, and Banking (JSCCIB).
  • All related parties, including the government, private sector, Finance Ministry, Bank of Thailand, National Economic and Social Development Council, TCG and financial institutions have deliberated on this issue.
  • “Given the economic downturn and excess production capacity, there is no more loan demand for new investment. Soft loans will be focused on supporting business liquidity,” he said.
  • “Loan approval will also focus on improving business potential and reducing long-term operation costs in preparation for the post-Covid-19 business landscape.”
  • The soft loan scheme is due to expire at the end of this year. The TCG’s credit guarantee for SMEs can be prolonged twice for six months, or until the end of 2021.

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