The government is about to launch nanofinance services as part of new measures aimed at addressing the problem of underground loans.
Nanofinance entails extending small loans with few or no requirements for collateral assets.
Finance Minister Sommai Phasee said the new financial service aimed at low-income earners would be launched by year-end as a New Year gift.
Under the scheme, interested investors can apply for nanocredit licences and set up a firm to operate retail credit facilities for about 100,000 baht per borrower at a lending rate with maximum interest of 36% a year.
Mr Sommai said the lending rate should be high enough to attract interested investors to enter this type of high-risk business, as the loan would be extended with little or no requirements for collateral.
However, he insisted the lending rate of the nanofinance service was relatively low compared with existing underground loans.
The nanofinance service is at the centre of Finance Ministry plans to get rid of loan sharks after banks complained that microcredit, which allowed them to lend informal workers up to 200,000 baht each at 28% interest, was not economically viable.
In a related development, the government's new economic stimulus package to be launched by year-end will focus on stimulating the economy in the long term, which needs cautious and thorough consideration.
Kritsada Jinavijarana, director-general of the Fiscal Policy Office (FPO) and the Finance Ministry's spokesman, said if exports for the remaining two months continued to grow after better-than-expected growth of 4% in October, as per the latest report by the Customs Department, then the economy during the remaining months of 2014 should see a recovery.
If fourth-quarter growth reaches 3%, the economy for the whole year is likely to grow by 1%, as recently predicted by the National Economic and Social Development Board (NESDB), he said.
And if the economy for the final
quarter expands by 4%, whole-year growth will match the 1.4% forecast made by the FPO.
The NESDB on Monday reported the economy this year is forecast to grow at the slowest pace since 2011 as exports falter, the government's budget disbursement faces delays and tourism sees a slow recovery.
It trimmed its forecast to only 1% growth this year, down from between 1.5% and 2% projected in August.
Export growth this year will probably be flat against the NESDB's earlier forecast of 2% growth.