BoT: Debt holiday for those in need

BoT: Debt holiday for those in need

2-month freeze on borrower payments

The Pathumwan intersection and its skywalk is void of traffic and people during the lockdown hours in the capital.  Pattarapong Chatpattarasill
The Pathumwan intersection and its skywalk is void of traffic and people during the lockdown hours in the capital.  Pattarapong Chatpattarasill

The Bank of Thailand is allowing a two-month debt holiday for individuals and small and medium-sized enterprises (SMEs) suffering a direct impact from the government's latest lockdown measures to combat the pandemic.

The measure, which includes the cooperation of the Thai Bankers' Association and the Association of International Banks, targets employees and employers in 10 provinces who have temporarily closed businesses as a result of the tighter lockdown measures.

This measure starts with monthly debt payments for July.

Borrowers who want to apply for this debt suspension measure can contact creditors from July 19.

Strict measures, including a curfew, have been imposed in Bangkok and five adjacent provinces for two weeks since Monday as the government attempts to curb the soaring number of new Covid-19 infections.

The same curfew has also been imposed in the four southernmost provinces of Narathiwat, Pattani, Songkhla and Yala.

"Under the debt moratorium, it will ease the financial burden of affected borrowers for a while by delaying debt payment. But the financial burden remains, so borrowers who have the ability to pay should do so to prevent a higher debt burden in the future," the central bank said in a statement.

The central bank is also allowing financial institutions to provide assistance to borrowers feeling an indirect impact from the government's coronavirus containment measures on a case-by-case basis.

Some business owners closed their operations due to the pandemic and are dealing with a liquidity crunch.

The Bank of Thailand also plans to collaborate with related parties including the Government Financial Institutions Association and non-bank lending institutions to expand the debt suspension measures to include as many borrowers as possible.

In a related matter, the Government Savings Bank (GSB) will suspend principal and interest payments this month for a period of six months for its clients in the 10 affected provinces, said GSB president Vitai Ratanakorn.

He said GSB already introduced a series of relief measures to ease the burden for customers suffering from the effects of the pandemic.

The Government Financial Institutions Association, comprising seven state-owned financial institutions, announced on Thursday a measure to suspend principal and interest payments for SMEs and retail borrowers for at least two months for those based in the 10 affected provinces, along with borrowers located outside these zones who have been burdened by the latest lockdown measures.

The measure starts for instalment payments for either July or August, depending on the borrower.

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