FTI to deliver SME strategy to Predee

FTI to deliver SME strategy to Predee

Faster disbursement of soft loans urged

New Finance Minister Predee Daochai
New Finance Minister Predee Daochai

The Federation of Thai Industries (FTI) is taking its economic rehabilitation plan to newly appointed Finance Minister Predee Daochai, urging the government to speed up issuing soft loans for small and medium-sized enterprises (SMEs) and to introduce new measures to stimulate the property market.

FTI chairman Supant Mongkolsuthree said the group will submit, possibly next week, its economic rehabilitation plan to Mr Predee.

According to Mr Supant, the FTI will ask the government to let Thai Credit Guarantee Corporation extend the debt guarantee for SMEs under the central bank's soft loan scheme for another two years from the existing two-year plan.

The central bank is offering 500 billion baht in soft loans at 0.01% interest to financial institutions for two years, to be lent in turn 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.

The lending scheme aims to support the liquidity of SMEs battered by the coronavirus pandemic.

Mr Supant said the government should speed up establishing a 50-billion-baht fund to assist micro enterprises and SMEs overall in gaining easier access to commercial bank loans. Many such companies have failed to qualify for loans from commercial banks, usually due to strict conditions.

The 50-billion-baht fund was proposed by former deputy prime minister Somkid Jatusripitak in June, as he wanted to offer a new channel of soft loans for SMEs to reinvigorate their businesses, which have borne the brunt of lockdown measures.

There are 3.3 million SMEs. Most of them gained little or no access to lending from local banks.

The government usually approves an annual 1-billion-baht budget for the Office of Small and Medium Enterprises Promotion (Osmep) to support 200,000 SMEs. For fiscal 2021, the government cut the budget by 5%.

Mr Supant said the new fund's budget source is undetermined. He suggested the government seek money from other sources if it fails to use budget from the 400 billion baht the government set aside for economic and social rehabilitation.

The state legal advisory body, the Council of State, said recently that Osmep was barred from using money from the 400-billion-baht package because of legal complications.

Mr Supant said the FTI will also ask the government to cut transfer and mortgage fees for housing units.

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