13 June 2024

Bank of Thailand Governor Sethaput Suthiwartnarueput has suggested that the “digital wallet” scheme should target certain people, instead of all Thais who are 16 and older, while debt a moratorium for all indebted farmers should also be selective.

He explained that not everyone who is eligible for the 10,000 baht under the digital wallet scheme needs the money and a lot of money will be saved if it is targeted towards people who are in need of it.

Regarding a debt moratorium for farmers, Sethaput said that there are many who are capable of servicing their debts and the best way to help these farmers is to help them settle their debts or to incentivise them so they can carry on servicing them.

He admitted that there are also many farmers who are heavily indebted and a debt moratorium, which is just temporary relief, will not help them settle their chronic indebtedness.

Bank of Thailand Governor Sethaput Suthiwartnarueput

A debt moratorium for all indebted farmers is not appropriate and will have negative consequences, claimed the governor, adding that similar measures have been applied 14 times by various governments and it was discovered that 70% of the indebted farmers have incurred more debt and many debts have become non-performing.

As such, the central bank has introduced measures to extend loan repayment periods responsibly and fairly to indebted farmers, while taking care of the farmers who are heavily indebted, said the governor.

He said that the central bank is waiting for a clearer picture from the government about the digital wallet scheme and whether the law relating to the central bank will need to be amended adding, however, that he has expressed the bank’s concern about the scheme to Prime Minister Srettha Thavisin during their recent discussion.

For a policy like the digital wallet, which requires funding of an estimated at about 560 billion baht, Sethaput said there must be a clear mid-term picture of the effects of the policy, such as the expenditure, the overall debt picture and deficits, in order to give the public confidence that fiscal discipline is still being observed by the government.

He said, however, that the central bank is merely doing its job by expressing its concerns, adding that the decision rests with the government.