State-owned Government Savings Bank (GSB) has launched soft loans totalling 10 billion baht to help small and medium-sized enterprises (SMEs) in the tourism sector improve their liquidity amid the pandemic, says president and chief executive Vitai Ratanakorn.
The three-year loan carries an average annual interest rate of less than 3%. SMEs can apply for the loan by registering at www.gsb.or.th by June 30, or until the total loan facility has been disbursed.
Individuals and juristic entities are allowed to borrow by placing vacant land plots as collateral. The loan amount each client can borrow cannot exceed 70% of the appraised value of their land.
The annual interest rate in the first year is 0.10%, 0.99% in the second year and 5.99% in the third year. The average interest rate is 2.36% throughout the three-year term.
The maximum loan for individuals and juristic persons is limited to 10 million baht and 50 million baht, respectively.
The bank relaxed lending under this scheme. In general, GSB considers the borrowers' cash flow before lending.
The outbreak means many SMEs in the tourism sector face cash flow problems. If the bank did not relax lending criteria for them, none of would be eligible for loans. As part of the scheme, GSB allows SMEs to place land as collateral to access the loans.