BOT to issue BNPL rules to curb rising First Jobbers' debt by October
The BOT is moving to regulate pay-later services that fuel overspending among young consumers, with First Jobbers’ debt at 52.7%, NPLs at 27% and transaction volume up over 38% a year.
Economic agencies have expressed concern over the consumption behaviour of the younger generation, particularly unnecessary instalment purchases through online platforms, which are causing young people to fall into debt early and could affect Thai household debt in the future.
Vitai Ratanakorn, Governor of the Bank of Thailand (BOT), said the BOT was preparing to regulate criteria for “buy now, pay later” (BNPL) services, which he said were encouraging overconsumption among young people.
The BOT will issue supervisory criteria covering both licensed operators and those relying on civil law, with clarity expected by October.
Bad debt among new graduates using BNPL reaches 27%
Vitai said 25.5 million Thais were in debt.
The most worrying point was that, among them, young workers, or First Jobbers, aged 20-35, had a debt ratio as high as 52.7%, while non-performing loans (NPLs) in this group stood as high as 27%.
Data from a survey of eight major operators found that the number of BNPL user accounts had grown sharply, from only 600,000 accounts and loans worth THB6.834 billion in 2021 to almost 5 million accounts and loans worth more than THB17.908 billion in 2024.
The average annual growth rate was as high as 99.9%, while transaction volume expanded by more than 38% a year.
Invisible debt behaviour: unnecessary instalment payments
The BOT Governor said technology had made access to credit worryingly easy, particularly the use of alternative data from online shopping to analyse and grant credit limits without consumers necessarily realising it.
Some platforms set BNPL payment as the default option, meaning that if buyers do not opt out, they may unintentionally incur debt.
Examples were also found of BNPL being used for inappropriate products, such as paying by instalments for bubble tea priced at 106 baht or chicken rice priced at 50 baht over 3-4 months.
This reflected the creation of a habit of spending without having the money and taking on debt too quickly.
Regulatory measures: tighter oversight for all groups
At present, BNPL operators often divide their operations into two parts: those using a Digital Lending licence, with credit capped at 20,000 baht and interest capped at 25%, and those using the Civil and Commercial Code, with no credit limit and interest capped at 15%.
The BOT admitted that it had previously had very little oversight of the latter group.
However, under the new criteria, the BOT will step in to supervise all companies that provide credit for purchases on online platforms, regardless of the interest-rate level.
The guidelines under consideration are as follows:
Set a minimum age for borrowers to prevent children and 20-year-olds who do not yet have regular incomes from accessing credit.
Screen product categories and set a minimum purchase amount.
The BOT will consider whether some products, such as low-priced food and drinks, including bubble tea and chicken rice priced at 50-100 baht, should be allowed to be bought by instalment, to prevent excessive small debts.
A clear opt-in system: users must actively agree to request a credit limit and choose to use credit themselves, rather than having it imposed automatically.
Implementation timeframe
The process of issuing these supervisory rules is expected to take around 5-6 months from now, or around September-October, because it must go through two rounds of public hearings, each lasting 30 days, to ensure prudence and fairness to all parties.
“The intention behind stepping in to supervise is not to view operators as villains. It is to prevent Thai people, especially young people, from being induced into taking on debt too early, to the point that it affects the country’s financial future.”
