DTAC, Line BK team up for digital loans
Total Access Communication (DTAC), the country's third largest mobile operator, has joined hands with social banking platform Line BK and Kasikorn Business Technology Group (KBTG) to provide personal loans to its users.
"This is the first time a telecom operator is collaborating with a social banking platform and a technology developer to offer financial services during this difficult time," said How Lih Ren, chief marketing officer of DTAC, via a virtual press conference.
The digital lending service, called "Jai Dee Mee Wong Ngern Hai Yeum" (Jai Dee Credit Line), is provided to both prepaid and postpaid users.
This digital lending campaign will first become available to a select group of DTAC customers before a full-scale launch.
"We are synergising across many sectors to develop an ecosystem of services that creates incremental value for customers," Mr How said.
According to him, customers have faced increasing financial stress and difficulties in managing daily expenses as result of the economic crisis of 2020-21.
Many DTAC customers have limited access to formal personal loan services, especially prepaid subscribers whose earnings are daily or weekly, he noted.
This group of users has high financial instability with no employment documentation or pay slips as proof of income. Moreover, some lack awareness of regulated loans.
Digital literacy gaps is also the widest in lower-income groups, he said, adding that residing in rural areas can be another obstacle to access affordable credit. DTAC's research indicates that 56% of its customers use mobile banking apps.
The users can apply for digital loans right through the Line app.
Tana Pothikamjorn, chief executive of Kasikorn Line Co, the operator of Line BK, said customers with a monthly income at least 5,000 baht will be able to access a credible source of funds through Line BK's loan services with reduced risks when seeking informal loans.
Customers with an approved credit line will also be able to receive 200 baht cash back and receive a special interest rate of 9.9% per year for two months from Line BK, he said.
After two months, the interest rate will be 18-33%, depending on credit rating and risk of the customers.
Up to 800,000 in loans will be provided to a user with the amount depending on their income and risk.
As of July, the number of users of Line BK reached 2.8 million and loan accounts hit 350,000.
KBTG chairman, Ruangroj Poonpol, said this partnership will help co-create innovative services. KBTG supports the campaign with service technology, including user interface.