Soft loan meeting planned
Bank of Thailand plans a discussion with banks that join its Bt300 billion soft loan scheme, following the criticisms that these participants have been rather slow in approving loans. To date, Bt2 billion of loans have been extended.
Pongpen Ruengvirayudh, an assistant governor for Financial Markets Operations Group, said that the slowness may be attributable to technical issues. She would call for a meeting, to discuss how to tackle the issues.
A source from the banking industry told Krungthep Turakij Online that the long holiday is part of the slowness. Meanwhile, it took a long time in preparation. The loan scheme was launched months after the flood disaster was over, and a large number of affected individuals and SMEs have sought financial help from some state-owned banks like Government Savings Bank.
On the refinancing portion, he also said that banks are reluctant to extend loans under the scheme for fear of lower returns, as they can charge only 3 per cent for the loans for a 5-year period. They would offer the refinancing loan only to financially-weak clients and those who may move to other banks.
Under the soft loan scheme, Bank of Thailand contributes no more than Bt210 billion to the scheme and the rest from financial institutions. Borrowers are charged 3 per cent for five years.
