The Finance Ministry is preparing a credit guarantee fund worth 50 billion baht to help small and medium-sized enterprises (SMEs) access credit.
According to Deputy Finance Minister Paopoom Rojanasakul, the new portfolio guarantee scheme (PGS 11), operated by the state-owned Thai Credit Guarantee Corporation (TCG), aims to provide lending guarantees for banks to quickly inject liquidity into the financial system.
This mechanism will reduce risk and increase collateral for SMEs in banks' assessments, helping those with insufficient collateral to access credit immediately, said Mr Paopoom.
The PGS 11 credit guarantee scheme has a project budget of 50 billion baht and offers a maximum of 40 million baht per borrower. The guarantee period is up to 10 years, and each guarantee cannot exceed 30% of the credit amount.
Priority is given to guaranteeing "new SMEs" first to broaden access to credit, he said.
According to Mr Paopoom, commercial bank loans for large businesses (more than 500 million baht) grew by 3.3% last year, but loans under 500 million baht contracted by 5.1%. Banks' capital adequacy ratio is 20.1%, the liquidity coverage ratio is 203% and the NPL coverage ratio is 176%, he said.
These figures reflect that banks are very stable, in part because they choose to lend only to large businesses, while SMEs are restricted from accessing credit as banks opt to avoid the risk, said Mr Paopoom. This leaves SMEs without necessary funds, leading to closures, production slowdowns and job cuts, affecting the economy, he said.
TCG's current guarantee portfolio amounts to 100 billion baht, with 12-13% covering the service sector, including tourism and wellness. Food and agriculture constitutes around 10% of the total portfolio.