BAAC to become first bank to accept trees as loan collateral
The Bank of Agriculture and Agricultural Cooperatives (BAAC) will be the first financial institution in Thailand to accept any of 58 types of trees classified as “prohibited trees” as collateral for taking loans from the bank, said Mr Natthaporn Jatusripitak, an advisor to the minister of Prime Minister’s Office.
The unprecedented move by the BAAC to accept trees as collateral from borrowers, especially low-income earners who don’t have any other property to be posted as collateral follows the Cabinet’s approval in principle of a forest bill proposed by the Ministry of Natural Resources and Environment to make it possible for private individuals or private sector to plant 58 types of “prohibited” trees to grow them on their property and the trees will not be classified as “prohibited”.
The 58 types of trees include teak, Chingchan, Payoong, Makamong, Pradoo Pa, Sathorn, Daeng, Peep, Kaena, Sattaban, Chamchuree, Makham (tamarind) and etc.
Mr Natthaporn said the bill which seeks to exclude the 58 types of precious trees from the list of “prohibited” trees if grown on private land would encourage people to grow more of these trees which will also help in reducing global warming and provide the low-income earners a means to seek bank loans.