Nov 4, 2009

Today the Economic Cabinet approved the Financial Sector Master Plan Phase II (FSMP Phase II), jointly proposed by the Ministry of Finance (MOF) and the Bank of Thailand (BOT), reflecting the importance placed on the setting of goals and strategic direction for continuous development of financial institutions system. The FSMP Phase II is to be implemented during 2010 – 2014, following the implementation of the FSMP Phase I during 2004 – 2008.

The microfinance community has been anxiously waiting for this document to be revealed to the public. Numerous press releases by government officials have suggested that it would strongly promote the microfinance sector in Thailand.

The Master Plan has several goals including promoting financial access to various groups of the population. “For example, new entry would be permitted for service providers with expertise and proven success in microfinance. In this connection, the MOF and the BOT would consider new licenses on a case-by-case basis, subjected to rules and conditions stipulated. Meanwhile, there would be measures to support the role of the government and SFIs in filling the gaps left open by commercial service providers.”
Further in the document, the Master Plan hopes to benefit society in the following ways:

- Improving access for users to a broad range of financial services that is appropriate for their needs, especially through the promotion of microfinance to help reduce
burden from resorting to informal market.

- Strengthening of grass-root communities through knowledge sharing between successful microfinance experts and local grass-root micro institutions, which would
lead to greater financial strength and financial immunity for all groups of the Thai society.

The document appears to be very focused on helping the current formal financial sector to expand its outreach into poorer communities. Meetings and consultations with banks will occur in November and implementation is expected to start soon after.

Source: Ministry of Finance