Many Thais weighed down by debts
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PEOPLE IN 40 provinces are burdened by off-system debts worth up to Bt1 billion, the Justice Ministry’s Legal Aid Centre for Debtors and Victims of Injustice revealed recently.
While most of these debtors in the North were duped into leasing farming tools, people in the Central and Northeast regions were preyed upon by “helmet gangster” moneylenders charging interest of 2 per cent per day or 20 per cent per month.
Debtors in the South were usually caught up in car-leasing schemes, the centre said.
Pol Lt-Colonel Wichai Suwanprasert, the centre’s secretary, said on Wednesday that the number of complaints received by his office was increasing.
“Each year, we get more than 200 cases, and there are more than 500 debtors owing Bt1 billion scattered across 40 provinces,” he said, adding that in Chaiyaphum province, it was found that a teacher was moonlighting as a moneylender and had up to 475 debtors.
He said that in one case, a person borrowed Bt100,000 and ended up having to pay back up to Bt300,000.
Most debtors in cities were vendors and salaried people, while those upcountry were mostly farmers, he said, adding that most of those who filed complaints had found themselves under debts of tens of thousands of baht.
Moneylenders advertised online, offering deals on car or tool leasing, while some even offered cash incentives, Wichai said. Debtors need to pay a monthly instalment for the goods, or else moneylenders repossess the goods and release them to others, he said, adding that such cases could fall within the frame of fraud.
As for the “helmet gangster” moneylenders, most plaintiffs were actually targeted by the same network, which has branches in several provinces, he said.
To deal with certain major “influential persons” to whom many people owed money, the centre has forwarded their information to the Department of Special Investigation and the police Central Investigation Bureau for investigation and further legal actions, Wichai said.
Panit Kerdchokchai, adviser to the Foundation of Virtuous Youth and also former director of the Stock Exchange of Thailand’s Learning Centre, said that in 2010 personal debts in Thailand amounted to 63 per cent of gross domestic product and rose to 85.9 per cent in 2014.
As of late this year, this figure increased to 90 per cent, of which only about 6.5 per cent were “good debts”, or loans taken to boost quality of life, such as home loans, she said.
She also cited a recent report by the Organisation for Economic Cooperation and Development showing that the three factors for the creation of debt were: the lack of money-management skills; far too easy access to monetary services, especially for public-school teachers; and the lack of agencies to protect people from unscrupulous moneylenders.
