Student debt repayments drop to 100 baht a month
The Student Loan Fund (SLF) is to introduce a more lenient loan repayment scheme -- which will go as low as 100 baht per month -- after defaults hit 45%, or 2.2 million bad debts, according to SLF manager Chainarong Katchapanan.
Recently, accumulated loan defaults hit 78 billion baht, said Mr Chainarong.
"If any debtors have financial issues, they can apply for a smaller deduction from their salaries via our application. The lowest tier is now just 100 baht a month," he said.
Just as with tax payments, student load repayments are automatically taken from workers' salaries to ensure payment, leaving many short of money to pay other bills. However, not all companies have adopted the automated system and there can be economic pressure on both employee and employer to not make the payments manually.
As of now, about 1.73 million in debt to the SLF are employed by 107,000 private firms and state organisations.
However, over the past two years, the SLF only obtained salary deductions from 14,800 private firms and state organisations, or counted as 1.26 million debtors.
The SLF is working on the issue to instruct those companies to collect money from another 466,000 loan default cases.
Over the past 20 years, the SLF has lent 655 billion baht money to six million students.
For this fiscal year, the SLF is preparing to lend 38 billion baht to 620,000 borrowers.
Despite the rise in defaulters, the SLF and has no plans to petition the government for extra funds as it remains highly solvent from the billions of baht in repayments that is does actually claim each year.
The SLF obtained 27 billion baht in the last fiscal year and 30 billion baht for in 2019.