The Finance Ministry is considering measures to address household debt for loans of less than 100,000 baht, which account for 35% of total household debt.
Speaking after the opening of the House and Condo Expo on Thursday, Finance Minister Pichai Chunhavajira said household debt tallies 13 trillion baht, excluding savings cooperatives, with 9 million accounts for more than 5 million people.
"The non-performing loans [NPLs] for household debt amount to 1.22 trillion baht, of which 35% or 427 billion baht consist of debt of less than 100,000 baht," he said.
"This means if we can resolve these debts, household debt will decrease by 35% immediately. Most of these debts have no collateral, and the creditor financial institutions have already set aside provisions for doubtful debts."
According to the National Economic and Social Development Council, household debt in the third quarter of 2024 was 89% of GDP, tallying 16.3 trillion baht.
"About 35% of this debt consists of unsecured loans, arising primarily from consumption and credit card debt. The problem is how to restructure these debts. Experience shows that when banks try calling, debtors often do not answer, either because they think they cannot pay or believe restructuring is impossible," said Mr Pichai.
"We will help restructure the debt for those with debts of less than 100,000 baht for as much as they are capable of repaying."
He said the ministry may need to adjust the debt restructuring approach for this group of debtors to make it more flexible, so they can recover and stand on their own again.
Once these debts are addressed, these individuals must be completely removed from the National Credit Bureau's blacklist, said Mr Pichai.
Resolving this debt problem requires cooperation from several parties, including the creditor banks and the government, he said.
Debtors with loans of less than 100,000 baht included in the scheme must have a reduced ability to repay their debts, while the financial institutions' cost for these debts must be zero, said Mr Pichai.
Some management fees for the debt may still apply, with some support from the government budget, he said.
Regarding real estate stimulus measures, Mr Pichai said these measures should be available by April, which may include reductions of the transfer and mortgage registration fees.
The previous measure reduced both fees to 0.01%, but expired at the end of last year.