Cabinet okays adjusted B5bn loan

The cabinet on Tuesday approved reworking the conditions of a 5-billion-baht soft loan programme to help small hotel operators and their supply chains including restaurants reopen.

According to Government House spokesman Anucha Burapachaisri, the new conditions and criteria of the loan programme will become more flexible and extensive, while the objectives are enlarged, extending the lending and repayment periods.

Hotel operators still in the process of applying for a hotel business licence will also be allowed to apply for soft loans.

Existing conditions require hotel business operators to own a hotel licence or be in the process of applying for one before Dec 31, 2020.

The new requirements also include entrepreneurs who posted a profit for at least one year in the past five years.

Earlier requirements called for a business to have registered a profit over the past three years.

According to Mr Anucha, the cabinet also approved extending the loan programme until June 30, 2023, or until the loans are fully secured from Sept 30 this year.

The repayment period was extended to 10 years from seven years previously.

Finance Minister Arkhom Termpittayapaisith said revisions of the lending scheme aim to help hotel operators increase their financial liquidity. The scheme will extend up to 5 million baht per client through the Government Savings Bank (GSB), he said.

The cabinet approved the "Re-Open" low-interest loan programme in July, offered to hotels and related supply chain businesses affected by the pandemic.

The 5-billion-baht loan scheme is offered via the GSB to some 1,000 businesses, including new and existing GSB clients, at up to 5 million baht per client.

Loan applicants had until Sept 30 this year to submit their requests.

The loan allows up to seven years for repayments, with up to two years of interest-only payments.

The government is to compensate the GSB at a rate of 2% per year for two years, for up to 200 million baht.

Eligible clients must be operators of hotels or businesses in the related supply chain, as well as small and medium-sized enterprises.

Loan applicants must be Thai citizens or Thai-registered corporations with more than 50% of shares owned by Thai nationals.

As of Sept 30, the GSB had approved only 124 million baht worth of loans under the programme to 64 applicants, representing only 2.48% of the 5 billion baht.