B30bn to be offered in debt relief push
The cabinet yesterday approved a three-year debt moratorium for farmers, which will cost the government about 30 billion baht.
Deputy Finance Minister Julapun Amornvivat said the first phase of the debt-suspension programme will begin on Oct 1 and run until Sept 30 of next year. The first phase will cost about 12 billion baht.
Details of the second and third phases are not given, as further cabinet approval is required.
Those eligible for the debt repayment suspension are farmers who borrow from the Bank for Agriculture and Agricultural Cooperatives (BAAC) with outstanding principal loans of no more than 300,000 baht each as of Sept 30 this year, with their loan status classified as normal, SML (special mention loan), and NPL (non-performing loan).
About 2.7 million farmers with combined debts of about 300 billion baht are eligible to join the scheme, Mr Julapun said, adding that they account for about 64% of the total number of BAAC’s debtors.
They can apply to join the programme from Oct 1 until Jan 31.
Mr Julapun added that they would also be allowed to borrow up to 100,000 baht each from the BAAC to pursue other careers during the debt suspension.
He said those with NPLs can enter the debt-suspension programme only after undergoing debt restructuring in line with the BAAC’s criteria.
He added that the government will also help shoulder the burden of interest repayments for this group of debtors for three months.
Mr Julapun said the cabinet has also approved measures to upskill farmers who join the programme as the BAAC will work with relevant agencies to hold career training sessions to enable them to pursue other careers to supplement their income, repay their debts and improve their livelihoods in the long term.
He said a working panel was also set up to work on debt suspension measures for farmers and small and medium-sized entrepreneurs (SMEs) affected by the impact of the Covid-19 pandemic.
Mr Julapun said he was appointed as head of the panel tasked with studying, analysing and setting debt-suspension measures for farmers and SMEs and providing recommendations on debt relief.
He said the Finance Ministry expects that the debt suspension programme will help boost small farmers’ liquidity so they can earn enough money to cover necessary household expenses.
“The programme will also expand their investment opportunities and improve efficiency in production, which will lead to more local purchasing power in the grassroots economy. This will provide security for farmers in a sustainable manner,” Mr Julapun said.
Deputy Agriculture and Cooperatives Minister Chaiya Promma said that during the cabinet meeting, some attendees suggested that the debt threshold for those eligible should be extended to 500,000 baht from 300,000 baht.
“The Finance Ministry will consider the matter again,” he said, adding that the debt-suspension scheme is different from similar schemes in the past. Measures will also be devised to empower farmers after leaving the programme, he said.
Chatchai Sirilai, president of the BAAC, said that currently, the BAAC has about 860,000 debtors with NPLs worth about 129 billion baht.
Mr Chatchai said that about 600,000 debtors with NPLs worth 36 billion baht are eligible to join the debt-suspension programme.
He also said the number of farmers who choose not to enter the debt-suspension programme accounts for about 40% of its debtors. The BAAC is planning to offer incentives to them to repay their debt, such as reducing interest rates, he added.
Meanwhile, government spokesman Chai Wacharonke said the cabinet approved a public debt management plan for the 2024 fiscal year.