The new economic team is preparing to amend the soft loan conditions for small and medium-sized enterprises (SMEs) to enable greater loan access and sustain jobs.
The government wants to work on problems in loan access in accordance with requests from SME operators, said Deputy Prime Minister Supattanapong Punmeechaow after chairing Monday’s meeting with Finance Ministry officials.
Mr Supattanapong, who was brought on board in the recent cabinet reshuffle, did not detail which soft loan conditions would be tweaked.
The Bank of Thailand talked with banks previously about recalibrating the scrutiny on loan applications to give SMEs easier access to funding after some complained they could not access it.
The change will prioritise the soft loan approval process, but will keep the same borrower categories and loan conditions because the royal decree does not allow any changes in conditions.
The central bank has been offering 500 billion baht in soft loans at 0.01% interest to financial institutions for two years to extend to SMEs with a maximum credit line of 500 million baht at 2% interest. The government will absorb interest charges for six months for SMEs that receive soft loans.
To be eligible, SMEs must operate domestically, be non-listed companies, have a credit line of up to 500 million baht from financial institutions, and continue to service debt or make late payments within 90 days at the end of last year.
Mr Supattanapong said the new economic team will adhere to the five guidelines that Prime Minister Gen Prayut Chan-o-cha detailed recently.
The guidelines mainly comprise addressing people’s needs during a time of economic hardships from the previous lockdown measures, rolling out sustainable economic stimulus measures, providing job creation incentives for businesses, focusing on hiring new graduates as well as working with honest actors, and listening to opinions from related sectors.
The Centre for Covid-19 Situation Administration, recently approved by the cabinet, will integrate the work process between the public and private sectors to accelerate suitable economic measures, said Mr Supattanapong.
Finance Minister Predee Daochai said an urgent policy need is addressing people’s income as unemployment spiked and trading activities waned due to the Covid-19 crisis.
The Finance Ministry hopes to expedite public investment to stimulate the economy and there are other measures to generate income for businesses such as allowing selected groups of foreigners to enter the country, said Mr Predee. Maintaining fiscal and financial discipline remains essential for the country as a loss of confidence would derail the economy, he said.