Saturday, August 24, 2019

Motorbike taxi drivers to gain as TCG boosts financial aid to small businesses

Jan 09. 2019
Facebook Twitter


2,241 Viewed

MOTORCYLE-TAXI drivers will be helped to get bank loans under a move by state-owned Thai Credit Guarantee Corporation (TCG) to provide them with credit guarantees.

The initiative is part of TCG’s efforts to issue credit guarantees of as much as Bt107 billion this year to small-business operators, TCG president Rak Vorrakitpokatorn said yesterday.

Rak, in announcing the measure, highlighted the essential role of motorcycle-taxi drivers in traffic-congested cities across the country and said the drivers needed financial support. Some 150,000 of them provide transport services for commuters in greater Bangkok, he said.

The TCG plans to work with state-owned and commercial banks to provide loans for them, with the banks offering the loans and the TCG providing the loan guarantees.

The average loan would be Bt50,000 each and would be used by the drivers to buy new motorcycles or improve their existing ones as well as buy additional safety equipment such as helmets, Rak said.


The TCG already has a credit guarantee scheme for drivers of car taxis in cooperation with the Small and Medium Enterprise Development Bank of Thailand (SME bank). The provision of credit guarantee to motorcycle-taxi drivers would mark an expansion in this field.

Surachai Danaitangtrakul, chairman of the TCG, said the motorcycle-taxi drivers would find that the new funding would reduce their leasing costs. Financial institutions are expected to charge them lower interest rates when such loans are guaranteed by the TCG, Surachai said.

The TCG plans to increase its loan guarantee portfolio to as much as Bt107 billion this year, up from Bt88.88 billion last year.

Rak expressed confidence that the economy would maintain its growth momentum this year, with gross domestic product (GDP) to expand about 3.8 per cent amid a global slowdown.

 “Many small businesses are still unable to access bank loans. With the support of the TCG they would be able to get loans from banks,” said Rak.

The TCG would also try to provide one-stop services for borrowers as it would provide a pre-approved loan service in order to increase the chances of small businesses getting loans from the banks, he said. Most banks do not have time to make credit assessment for small loans, so the TCG would look at loans of less than Bt15 million by making pre-approved loan assessments before introducing the drivers to the banks, he said.

This would lessen the workload for banks and at the same time assist clients to get loans more easily from the banks, Rak said.

The TCG works closely with state-owned bank such as SME bank, Government Savings Bank and commercial banks such as TMB, Kasikornbank, Siam Commercial bank and Bangkok Bank, he said.

The new credit guarantee portfolio of Bt88.88 billion last year is up 14 per cent from the year before. “We aim to increase the credit guarantee portfolio back to the Bt100 billion level, as the TCG did in the past,” Rak added.

Some 77,862 entrepreneurs gained credit guarantees last year, and the TCG aims to support 82,600 entrepreneurs this year. 

Surachai said that if the banks were to become more cautious in providing new loans for SMEs this year, due to a lacklustre economy, the TCG could enhance its credit offerings and assist borrowers to get loans.


Facebook Twitter
More in Business
Editor’s Picks
Top News