Personal loans expanded again in May, indicating that households are still struggling and seeking fresh borrowing.
Commercial banks issued personal loans worth 326 billion baht, up from April's 324 billion and 316 billion recorded in May last year, according to data from the Bank of Thailand.
May marked a third straight month of expansion in personal loans, which include those lent by non-banks, following a dip in January and February.
Commercial bank loans provided to households accelerated between February and April compared with last year's final quarter due to temporary factors such as the government's property stimulus measures and the tax deduction scheme for private consumption and tourism over Songkran, said the central bank's latest Monetary Policy Report issued on June 30.
Seasonal factors also contributed to a rise in loans associated with housing and credit cards, said the report.
Thailand's swelling household debt has dampened consumption and economic growth. Household debt in last year's final quarter climbed to 11 trillion baht or 81.5% of GDP, an increase from 10.8 trillion or 80.8% of GDP in the third quarter.
Roong Mallikamas, the central bank's senior director of macroeconomic and monetary policy, said recently the improvement in economic conditions in April and May was the reason the central bank maintained its GDP growth forecast at 3.1% for this year.
Economic growth in the second quarter was expected to accelerate at a faster clip than in the previous three months, underpinned by ramped-up public disbursement and buoyant tourism revenue, said Wuttipong Jittungsakul, director of the macroeconomic policy bureau at the Finance Ministry's Fiscal Policy Office.
Overall commercial bank loans increased to 13.9 trillion baht in May, up from 13.8 trillion a month earlier and 13 trillion in last year's corresponding period.
May's commercial bank deposits were recorded at 12.5 trillion baht, down from April's 12.6 trillion but up from 12.2 trillion registered in May last year.
Credit card spending in May, meanwhile, was valued at 142 billion baht, up from 140 billion in April and 130 billion in May last year.
In a related development, the value of transactions by electronic plastic cards, which consist of ATM cards, credit cards and debit cards, rose in May to 1.2 trillion baht, up from April's 1.15 trillion and on a par with the 1.2 trillion recorded in last year's corresponding period.
Total plastic cards amounted to 82.6 million in May, up from April's 82.3 million and 80.4 million registered in the same period last year.