The Cabinet agreed to adjust the credit criteria to enhance the community economy of SME banks, extending the loan period up to 10 years, with a limit of 6,889 million baht.
On September 21, 2021, at the Government House, Ms. Ratchada Thanadirek, Deputy Spokesperson for the Prime Minister’s Office, announced that the Cabinet meeting (Cabinet) approved the improvement of the criteria for the Local Economy Loan project. ) under special measures to drive SMEs into the 4.0 era (financial measures) in accordance with the current situation The Small and Medium Enterprise Development Bank of Thailand (SME Bank) is the main operating unit. The criteria for improvement are as follows:
1. Adjust the loan term to a maximum of 10 years and the repayment grace period. Maximum of not more than 2 years from the original maximum loan term of not more than 7 years and grace period for repayment of principal up to 12 months
2. Fixed interest rate but adjust the period to be extended to 10 years in case the borrower is an individual, 1st – 3rd year, charged interest rate MLR – 1.875 per year, 4th – 10th year, according to the interest rate specified by the Bank of Thailand In case the borrower is a juristic person, the 1st – 3rd year, the interest rate is MLR – 3.875 percent per year, the 4th – 10th year, according to the interest rate specified by the Bank of Thailand
3. Collateral: Adjusted for the Small Industry Credit Guarantee Corporation (TCG) to guarantee or use collateral as specified by the Bank.
“Due to the new wave of COVID-19 epidemic affecting SMEs more, SME Bank would like to improve the project criteria to help SMEs entrepreneurs to have access to funding sources and repay debt in accordance with business income stream”
The loan project has a total loan limit of 50,000 million baht. As of June 30, 2021, 25,566 SMEs have approved loans, totaling 43,110 million baht, or 86.22% of the total credit limit of the project. As a result, there is a remaining project limit of 6,889 million baht, which can help SME entrepreneurs to access funding sources about 4,100, help maintain employment for at least 20,500 people, and generate more than 31,551 million baht in working capital in the economy.
