In a recent Economic Cabinet meeting, Deputy Prime Minister and Minister of Finance Pichai Chunhavajira announced a significant proposal for the Bank of Thailand (BOT) to collaborate with financial institutions to lower the minimum monthly credit card payment from 8% to 5%. This measure aims to provide financial relief to debtors during the ongoing economic downturn.
Previously, the minimum payment was temporarily reduced to 5% during the COVID-19 pandemic but was increased to 8% at the beginning of 2024. The standard 10% minimum payment is scheduled to be reinstated by 2025.
Currently, approximately 24 million credit cards are in circulation in Thailand. Of these, over 1.1 million cards have overdue balances exceeding 90 days, categorizing them as non-performing loans (NPL). An additional 200,000 cards are at risk of becoming NPLs. High-interest rates on these debts have prompted initiatives such as the Debt Clinic by Sukhumvit Asset Management Company (SAM), which aims to prevent further debt accumulation and extend repayment periods.
In addition to credit card debt relief, efforts are ongoing to restructure automotive debts, particularly for pickup trucks and motorcycles, which are vital for many people’s livelihoods. Discussions with relevant stakeholders and finance companies are focused on separating NPLs from repossessed vehicles and new loans. The proposed solutions will be presented at the next Economic Cabinet meeting.
Officials, including various stakeholders and representatives from finance companies, were present at the meeting to discuss these proposals and their potential impacts. The outcomes of these discussions will be closely monitored as they progress.