18 January, 2011
Microfinance service not populism: Chuti
Information and Communications Technology Minister Chuti Krairiksh has denied that the government's forthcoming provision of microfinance through Thailand Post is a populist policy.
"It is not giving away money," he said yesterday during a visit to inspect living conditions in Omkoi district in Chiang Mai. Chuti and senior Thailand Post executives also visited a post office to check on its readiness to provide the microfinance service. Omkoi is one of 10 areas across Thailand where Thailand Post will pilot the microfinance service, which is expected to start in February. Chuti said the service was aimed at reaching people who cannot access low-interest loans and providing them with economic opportunities.
"This is not a political campaign but part of the Abhisit government's policy of solving the loan-shark problem," he said. The Thailand Post board last week approved the establishment of a subsidiary to provide microfinance, naming it Thailand Post Loan Ltd.
The move follows Cabinet's approval for Thailand Post to set up a wholly owned subsidiary at a cost of Bt50 million to offer microfinance to those with difficulty accessing conventional loans. It will provide loans of a maximum of Bt10,000 to individuals at low monthly interest rates, expected to be between 1 and 2 per cent. The term for loan repayment will be one year. Those applying for loans will need four guarantors.
Thailand Post will evaluate the subsidiary's performance in six months to see whether it needs to change its loan strategy. It will operate under advice from the Government Savings Bank and the Bank for Agriculture and Agricultural Cooperatives during the initial stages of operation.
The Finance and ICT ministries believe Thailand Post can draw on its 1,200 post offices nationwide and 22,000 employees to provide financial services to the grass roots.
A source at Thailand Post said the board believed that if there is a high proportion of non-performing loans from the microfinance service, the Finance Ministry and Thailand Post should share responsibility. Chuti said Thailand Post Loan would carefully screen those it lent to and not just hand out money to anyone.
Source: The Nation
"It is not giving away money," he said yesterday during a visit to inspect living conditions in Omkoi district in Chiang Mai. Chuti and senior Thailand Post executives also visited a post office to check on its readiness to provide the microfinance service. Omkoi is one of 10 areas across Thailand where Thailand Post will pilot the microfinance service, which is expected to start in February. Chuti said the service was aimed at reaching people who cannot access low-interest loans and providing them with economic opportunities.
"This is not a political campaign but part of the Abhisit government's policy of solving the loan-shark problem," he said. The Thailand Post board last week approved the establishment of a subsidiary to provide microfinance, naming it Thailand Post Loan Ltd.
The move follows Cabinet's approval for Thailand Post to set up a wholly owned subsidiary at a cost of Bt50 million to offer microfinance to those with difficulty accessing conventional loans. It will provide loans of a maximum of Bt10,000 to individuals at low monthly interest rates, expected to be between 1 and 2 per cent. The term for loan repayment will be one year. Those applying for loans will need four guarantors.
Thailand Post will evaluate the subsidiary's performance in six months to see whether it needs to change its loan strategy. It will operate under advice from the Government Savings Bank and the Bank for Agriculture and Agricultural Cooperatives during the initial stages of operation.
The Finance and ICT ministries believe Thailand Post can draw on its 1,200 post offices nationwide and 22,000 employees to provide financial services to the grass roots.
A source at Thailand Post said the board believed that if there is a high proportion of non-performing loans from the microfinance service, the Finance Ministry and Thailand Post should share responsibility. Chuti said Thailand Post Loan would carefully screen those it lent to and not just hand out money to anyone.
Source: The Nation
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