Bangkok: “Chulaphan” outlines the strategy for acquiring bad debts to aid in resolving the Non-Performing Loan (NPL) issue, thereby reintegrating individuals into the economic system. This approach aligns with the Ministry of Finance’s current guidelines, which already include mechanisms to support those who consistently pay their debts.
According to Thai News Agency, Mr. Chulaphan Amornvivat, Deputy Minister of Finance, discussed the government’s initiative to repurchase bad debts from the public. He noted that the solution proposed by former Prime Minister Thaksin aligns with the Ministry of Finance’s approach, under the supervision of Mr. Pichai Chunhavajira, Deputy Prime Minister and Minister of Finance. However, a definitive plan has yet to be established. This initiative aims to provide individuals with bad debts an opportunity to reintegrate into the economic system. He emphasized that individuals who meet their debt obligations are considered good debtors.
Mr. Chulaphan reassured that the government remains attentive to good debtors, as they benefit from greater access to credit and lower interest rates based on debt classification. He remarked, “Don’t think that the government doesn’t take care of good debtors because they have more access to credit and lower interest rates, according to debt classification.”
He further stated that the trajectory of NPLs has shown significant improvement. Initially, NPL figures were rising, but they have now stabilized. Despite this, no specific measures have been implemented to transition people out of NPL status. Consequently, targeted measures are necessary to support those already affected, transforming them back into productive economic units. The government prioritizes assisting vulnerable individuals before addressing other groups.
When questioned about the possibility of a debt haircut, Mr. Chulaphan clarified that the strategy does not involve a debt haircut since the debt is acquired from financial institutions. The government and private sector funds can be utilized in two ways, akin to the previous joint venture Asset Management Corporation (JV AMC) utilized by the Government Savings Bank for managing business debt. The government’s renewed efforts aim to establish a structure that effectively reaches the grassroots level.
