Free EDC devices on offer to small firms
Thanachart Bank is offering small businesses free use of electronic data capture (EDC) devices as part of its effort to encourage such enterprises to become its clients.
TBank has attempted to grow in the small-business sector for two years but has been limited by the fact that many of these enterprises don’t have bank statements, said Sanong Khumnuch, deputy managing director for retail and small-business distribution.
Two years ago, the bank said it wanted to drive its outstanding loans to small businesses to Bt15 billion, but as of last year, the figure was only Bt11 billion.
TBank has 10,000 small-business clients.
About 70 per cent of small and medium-sized enterprises don’t have bank statements, he said.
TBank has only 2 per cent of the EDC devices used by merchants but believes it could reach 5 per cent by the end of this year after offering them rent-free to small businesses.
Most small business registered with the Commerce Ministry do not have EDC because they are more comfortable dealing with cash, and also resent the costs associated with EDC.
Sanong said that in the first phase of TBank’s EDC expansion, it was targeting merchants in tourism areas.
The bank plans to adjust the definition of “small business” from enterprises with annual revenue of Bt600 million to annual revenue of Bt10 million to Bt20 million because the latter range is more in keeping with the actual performance of its customers.
The bank is also adjusting its internal processes and the credit scoring for its target customers.
The free-EDC deal is one of three packages TBank offers SMEs. The other two feature low transactional fees of Bt199 or Bt299 a month, compared with fees totalling more than Bt1,000 that they could face without the packages, he said.
The bank has targeted three kinds of business that should offer opportunities, namely pharmaceuticals, construction materials and gold merchants.
Businesses that want to lower their risks are another focus of TBank, he said.
With the SME packages and the clear focus on what type of customers it wants, the bank hopes that the outstanding loans this year will reach Bt16 billion to Bt17 billion.
“We have customers who are ready to draw down loans of Bt10 billion. We have also sent teams to list merchants near our bank branches, and we have around 4,000 merchants on the list,” he said.
