The Industry Ministry plans to encourage 11,505 merchants at the Chatuchak Weekend Market to join the e-commerce platform and use short-term loans to help small and medium-sized enterprises (SMEs).
The ministry is teaming up with Bangkok Metropolitan Administration (BMA), the Small and Medium Enterprise Development Bank of Thailand (SME Bank) and the University of the Thai Chamber of Commerce (UTCC) to work on this programme.
E-commerce site Shopee was chosen to support 11,505 merchandisers at the market. The ministry plans to bring Chinese and Indian SMEs to take part in the business matching scheme.
Mongkol Leelatham, president of SME Bank, said it will provide loans for each merchandiser with interest rates of 0.25% and 0.42% per month for companies and personal SMEs, respectively.
The bank will provide a financial programme for local SMEs during the transition period onto the digital platform through the SME Development Fund under the Pracha Rat (People's State) initiative, with an interest rate of 1% per year.
"Normally, the merchants can sell products only on the weekend, but when their shops go online, they can run their business everyday while promoting their products on the marketplace," said Mr Mongkol.
Thanawat Phonvichai, director of the Center for Economic and Business Forecasting at UTCC, said the centre conducted a survey to support the ministry's programme and found that 58.8% of Chatuchak merchants have already used the digital platform, but the remaining 41.2% cannot use e-commerce channels as they find the process too complex and requiring too high a budget.
"Once the government launches measures or programmes to encourage merchants to join the digital platform, they become interested," said Mr Thanawat.
He said Chatuchak merchants require state financial support with low interest rates as they need loans worth 11-20% of sales revenues.
According to the UTCC survey, most merchants have been selling at the weekend market for 4-6 years and have an average revenue of 139,500 baht per month.
Monthly rent at the market stands averages 10,600 baht to the State Railway of Thailand and 17,700 baht for third parties.
Somchai Harnhiran, deputy industry minister, said the digital platform is becoming essential and offers many benefits to local SMEs, such as lower costs, higher efficiency and new trade channels.
The Chatuchak scheme is in line with the ministry's programme to support SMEs and startups nationwide through Industry Transformation Centres in 77 provinces.
Thailand has roughly 5 million SMEs, with 1 million registered with the ministry as of 2018.