Government Savings Bank (GSB) is aiming to lower the interest rate for car title loans to ease the burden on borrowers in this segment, says Vitai Ratanakorn, the bank's president and chief executive.
GSB recently made a foray into this business to help reduce the market interest rate for the loan segment.
The bank acquired a 49% stake in car title loan provider Fast Money Co Ltd.
Fast Money was previously a wholly-owned subsidiary of Srisawad Corp.
Prior to GSB's entry, the market rate for car title loans was 24-28% per year or 0.89-0.93% monthly. The rate is currently 0.63-0.67% monthly.
Mr Vitai said GSB set aside vehicle title loans this year worth 20 billion baht, with the loan limit not exceeding 200,000 baht per borrower. It is also targeting 1 million customers this year.
GSB is eager to roll out this service at 800 of its 1,000 outlets this year. Fast Money has 4,900 branches nationwide.