Household debt situation worsening
Average household debt for Thai workers recorded a historic surge of almost 30% to around 205,000 baht in 2021 when compared with 2019, driven by the pandemic, says the University of the Thai Chamber of Commerce (UTCC).
The survey by the UTCC's Center for Economic and Business Forecasting gauged 1,256 respondents across the country from April 18-22. Respondents had less than 15,000 baht in monthly income. The survey is conducted annually, except in 2020 when the lockdown prevented the survey from being carried out.
In 2019, the average household debt was 158,855 baht, up 15.1% year-on-year.
Thanavath Phonvichai, president of the UTCC, said 98.1% of the respondents had household debt, up from 95% in 2019. They said they had to seek loans for daily spending and debt repayment when falling short of cash.
Some 67.6% of the respondents said they had no savings. Among those with savings, 9.14% of their monthly income went towards it, down from 14.9% in 2019.
The country's economic condition is the issue causing most concern among the respondents, followed by the Covid-19 situation, lack of access to vaccines as well as product prices.
Some 85.1% of respondents said they had debt repayment problems over the past year due to the lack of liquidity, soaring expenses, a disparity between earnings and spending, unemployment and the sluggish economy.
Some 71.5% indicated they were troubled by their income being lower than their spending. Formal loans were the most popular option for dealing with the issue (47.2%), followed by informal loans (13.6%), asset sales (12.3%), the use of savings (12%), seeking relatives' help (9.6%) and exploring extra jobs (5.3%).
A full 86.1% of respondents want the government to usher in steps to ease the debt burden, such as suspending debt repayment, while 14% want the government to cut interest rates. To help with living costs, a co-payment scheme was the most favoured option at 41.3%, including the Rao Chana (We Win) scheme.