The deposit ratio outlook for the Government Savings Bank (GSB) is not expected to decline as the bank offers higher deposit interest rates than large commercial banks.
Though Thailand is going through an economic crisis caused by the pandemic, the bank projects this year's total savings deposits to tally 2.5 trillion baht, an increase of 50 billion from year-end 2019, said president and chief executive Vitai Ratanakorn.
GSB has strong fundamental business operations and is guaranteed by the government, and it offers higher deposit interest rates, by an average of 10-30 satang, depending on deposit products, than the top five commercial lenders in the country, said Mr Vitai.
Some 50% of the bank's total savings deposits are identified as GSB lottery, and 20% are made up of current account and savings deposits, with the rest attributed to fixed deposits.
The total number of depositors is registered at 17 million.
Higher financial liquidity derived from an increase in savings deposits will be managed by GSB, but the bank still emphasises the importance of savings, deemed a good foundation for society, said Mr Vitai.
In an attempt to stimulate saving among youth, GSB has launched a youth savings account programme, with savings deposits capped at 1.25%.
The minimum amount for account opening is 100 baht and depositors have to continuously make deposits until August next year, with a minimum deposit of 50 baht.
The maximum deposit amount throughout the entire period is capped at 100,000 baht.
"Promoting saving among the youth is part of our commitment as a social bank to strengthen the savings foundation of society," said Mr Vitai.
Krisada Chinavicharana, permanent secretary for finance, said the National Savings Fund's (NSF) board of directors is considering proposing amending the law to expand the fund's savings ceiling rate and raise the age of fund members to above 60.
But the move will have to be put on hold until the government's finances improve, said Mr Krisada.
At present, the law stipulates that NSF members shall contribute 50 baht per month as minimum savings, with the maximum limit capped at 13,200 per year. Government contribution to the NSF tallies around 600-700 million baht per year.