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Debt of poor households & failure to make monthly payments rising fast after lenders push loans. Campaign to reduce dangerous debt.

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ECONOMY

BoT seeks aid for poor debtors

2/11/2012
Parista Yuthamanop

The Bank of Thailand will ask banks and non-bank operators to cooperate in curbing the debts of low-income households because defaults are increasing, says governor Prasarn Trairatvorakul.

The central bank found the indebtedness of borrowers with monthly income of less than 10,000 baht has increased substantially amid campaigns by banks and non-bank operators to promote consumer loans, bringing an increase in one-month defaults, he said.

Loans to borrowers in a slightly higher income bracket of 10,000 to 15,000 baht have brought an increase in indebtedness but not much of a problem with defaults.

"We understand the indebtedness and defaults may result from their low income. In some cases, their level of indebtedness is equal to their monthly income. The central bank's premise is to look after them, not to create too much debt," said Dr Prasarn.

"His comments are in line with National Statistical Office data showing household debt standing at 40%, higher than in many countries."The central bank may ask banks and non-bank operators for their cooperation in improving the consideration process of such lending and not to stimulate consumer lending to low-income customers," said Dr Prasarn.

Banks and non-bank lenders have increasingly engaged in fierce competition in the low-income segment with campaigns to spur consumption. Many people perceive they can use their future money easily, as financial institutions stand ready to offer them a loan.

Dr Prasarn said the central bank will step up efforts to improve knowledge about savings and avoiding too much debt, especially with the Thai and global economies in a downturn.

"Bank and non-bank operators should exhibit social responsibility. We somehow have to revert to the basic principles of save first and spend later, spend what we have or borrow to the amount of repayment ability," he said.

Competition by banks and non-bank operators in this segment has resulted in the creation of various loan types.

(Source: Bangkok Post, ECONOMY, BoT seeks aid for poor debtors, 2/11/2012, Parista Yuthamanop, link) 

 
Debt Problems Vocabulary

debt - an amount of money that you owe หนี้
debtors - people or companies that owe others money
poor debtors

indebtedness - owe money to people, must pay back money to people
the indebtedness of borrowers

loan - an amount of money that a person, business, or country borrows, especially from a bank เงินกู้
offer a loan

default - failure to do pay back borrowed money (debt) on time
defaults are increasing

one-month defaults - failure to make required monthly payment on loan (paying back money borrowed)
an increase in one-month defaults

aid -  help or assistance given to someone ความช่วยเหลือ  เงินช่วยเหลือ
seeks aid for
BoT seeks aid for poor debtors

operators - businesses doing this business
non-bank operators

cooperate (verb) - to work together with other people to achieve a result that is good for everyone involved การร่วมมือกันระหว่าง
cooperation (noun) - working together to achieve shared goals ความร่วมมือ, การทำงานร่วมกัน

income - money that people receive from work or some other source, used for household consumption and savings
households - families or groups of people living together (economics treats this as a unit that makes decisions)
low-income households

curb - end or reducing something bad
curbing the debts of low-income households

has increased substantially
X amid Y

consumer - someone who buys and uses goods and services ผู้บริโภค
consumption - money spent by households and families on goods and services การบริโภค (See Wikipedia)

consumer loans
promote consumer loans

campaigns - a long series of events staged to achieve a goal or to promote something (for example, an "anti-smoking campaign" or a marketing campaign)
campaigns by banks and non-bank operators to promote consumer loans

bracket - some numbers such ages, prices, etc. being between two mumbers (within a range of numbers) 
income bracket - incomes being in a certain range

Loans to borrowers in a slightly higher income bracket of 10,000 to 15,000 baht

premise - an idea or principle that you base other ideas or actions on (used to form new ideas and actions)
The central bank's premise is to look after them, not to create too much debt

household - a group of people, often a family, who live together ครัวเรือน
household debt standing at 40%

data - facts or information used for making calculations or decisions ข้อมูล
National Statistical Office data showing household debt standing at 40%, higher than in many countries

in line with - agreeing with, matching, being same as
His comments are in line with National Statistical Office data

cooperation - when people work together to achieve goals that benefit all of them
ask  for their cooperation

consideration - anything of value promised to another when making a contract (under common law both parties must offer some consideration before a contract can be thought of as binding) (See Wikipedia)

process - a series of actions that you take in order to achieve a result แนวทางปฏิบัติ, กระบวน, วิธีการ
consideration process

lending - giving money to someone who agrees to pay it back in the future การให้ยืม
improving the consideration process of such lending

stimulate - act so as to increase activity กระตุ้น encourage activity, growth, and development
stimulate consumer lending
not to stimulate consumer lending to low-income customers

engaged - actively involved in what you are doing
fierce - very intense and very aggressive
engaged in fierce competition

segment - a part of something ตอน a separate part ส่วนต่างๆของสังคม
low-income segment

lenders have increasingly engaged in fierce competition in the low-income segment

spur - to cause something to happen ก่อให้เกิด
spur consumption
campaigns to spur consumption

financial institutions - banks and other organizations like banks that make loans  

stand ready to - are ready to do something (if needed)
stand ready to offer a loan

perceive - to come to an opinion about something, or have a belief about something รับรู้ feeling a certain situation to be true

Many people perceive they can use their future money easily, as financial institutions stand ready to offer them a loan.

efforts - the work done towards achieving some goal ความพยายาม
step up efforts - increase efforts, increase work towards achieving a goal

improve - to make better ทำให้ดีขึ้น
improve knowledge

the central bank will step up efforts to improve knowledge about savings and avoiding too much debt,

global - throughout the world, all over the world, including the whole world ทั่วโลก ทั้งโลก
global economies

downturn - ระยะตกต่ำ going down fall suddenly by a large amount ตกต่ำลง, ตกต่ำ
economic downturn - a bad economy, with incomes that are not growing and many people unemployed

the Thai and global economies are in a downturn

responsibility - 1. being blamed for something that goes wrong, 2. having to take care of some task as part of your job
social responsibility

exhibit - show แสดง
exhibit social responsibility

Bank and non-bank operators should exhibit social responsibility

principles - the basic rules (of some activity or event) กฎระเบียบเบื้องต้น
basic principles

save first and spend later

revert to - go back to (something you did in the past)
revert to the basic principles of save first and spend later
spend what we have or borrow to the amount of repayment ability

creation - the act of making something new การสร้าง
the creation of various loan types.

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