Thais flock to register for debt scheme
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Thais flock to register for debt scheme

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Thais flock to register for debt scheme

Debtors are rushing to register for debt restructuring under the "You Fight, We Help" programme, a collaboration between the Finance Ministry, Bank of Thailand and financial institutions, with nearly 600,000 accounts registered.

The ministry said since registration opened on Dec 12, 2024 to Jan 28, 2025, 497,000 debtors expressed their intention to participate on its website, with their eligibility currently being reviewed. There were 576,000 accounts included in applications, not including those who registered directly with financial institutions.

The central bank, in cooperation with the Finance Ministry, the National Economic and Social Development Council, the Thai Bankers' Association, the International Bankers' Association, the State-owned Financial Institutions Association, and certain non-banking business operators, launched temporary measures to assist individual debtors and small businesses under the "You Fight, We Help" programme.

The support covers debtors that use commercial banks, specialised financial institutions, and businesses in the non-bank sector that are part of the financial business sector.

The scheme aims to reduce monthly debt repayments over a three-year period.

Participants are required to pay a minimum instalment of 50%, 70% and 90% of their original instalment in the first, second and third years, respectively (in a step-up manner). All payments made are applied to reduce the principal.

The interest burden during the three years of the programme is fully waived if the debtor complies with the conditions and does not incur additional debt within the first 12 months after joining.

Debtors can pay more than the minimum required instalment to further reduce the principal and settle their debt faster.

Eligible debtors for this programme must have a loan agreement signed before Jan 1, 2024, and their debt status as of Oct 31, 2024 must meet one of the following criteria: the debt is overdue for more than 30 days but not exceeding 365 days from the due date, or the debtor has previously undergone debt restructuring (since Jan 1, 2022) for overdue payments of more than 30 days from the due date.

Registration for this programme ends on Feb 28.

A source from the Finance Ministry who requested anonymity said 1.9 million debtors with 2.1 million accounts are expected to participate in the programme, with a total outstanding debt of roughly 890 billion baht.

The measures are expected to help reduce household debt by several percentage points, said the source.

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