BAAC offers partial interest payment refund to good clients
THE BANK for Agriculture and Agricultural Cooperatives is giving a New Year’s gift to its customers via a 3-to-5-per-cent refund in interest payments worth Bt3 billion to 3.53 million debtors showing a good financial track record in the past three years.
“The gift is in accord with the government’s New Year gift policy and also the bank’s mission, which is to support Thai farmers,” Somsak Kangteerawat, senior executive vice president of state-run BAAC, said yesterday. The bank will refund a 5 per cent of interest payments to individual debtors with good financial discipline for the last three years, 4 per cent for two straight years and 3 per cent for one year.
New borrowers will also receive the 3-per-cent interest payback.
The 1,385 BAAC-recognised cooperatives that have been assessed at levels 1-3 will receive 5-per-cent interest-rate payback, levels 4-6 will receive 4 per cent and levels 7-9 will receive a 3-per-cent payback.
The Cabinet approved the specialised bank’s gift last week.
The state bank also unveiled a loan package backed by a budget of Bt50 billion offering a 4-per-cent interest rate for seven years.
The bank will give out the loans from 2016-18 to some 100,000 farmers interested in sustainable farming.
The package is aimed at sustainable farming projects such as clean energy, safe food products and new age agriculture, and to improve access to funding for sustainable farming.
Examples of these projects are organic farming, integrated agriculture, the farming of crops that consume less water such as beans instead of off-season rice, the production of seeds under the Good Agricultural Practices and Good Manufacturing Practices standards, the farming of alternative energy crops, the growing of high value decorative flowers, the use of renewable energy, the domestication of animals in accord with GAP standards, and the promotion of agricultural tourism.
The two measures cost the state bank Bt2 billion in lost income, which is less than the combined budget of the two measures, as the bank has lowered its unnecessary expenditures in the past year.
The BAAC has also prepared measures for the expected drought next year via extending loan terms for farmers hit by the drought for 24 more months and lowered the interest rate to 4 per cent for the next four to five months, which is expected to be the driest period before the raining season kicks in.
The bank’s non-performing loans are expected to decrease from 4 per cent, or more than Bt40 billion, to 3.4 per cent or around Bt30 billion to Bt40 billion.
