The plan to alleviate poverty in Chiang Mai has been
kick-started with the approval of loan sums of over five million baht for
126 applicants from Muang district. Each applicant will receive 15,000 baht.
At Chiang Mai City Hall, Government Savings Bank (GSB)
director Korapoj Atsawinwijit and Chiang Mai governor Suwat Tantipat
approved the funding for the government’s plan to alleviate problems
caused by poverty.
Korapoj said that the distribution of the funding would
offer a chance for the poor registered under the integrated development plan
to eliminate debt and the money would serve as revolving capital for them to
earn income and improve their quality of life.
The loans would be controlled like those of the
People’s Bank and have the same loan policy of a one percent interest
rate, with the debt being paid off within a year.
Korapoj said that about 250,000 people in Chiang Mai had
registered under the plan. The total amount of debt was estimated at over
20.1 billion baht. This was divided into debt owed to loan sharks (2.1
billion baht) and to banks (19 billion baht, of which 1.2 billion baht was
owed to the GSB itself).
The GSB would examine debts owed to both illegal and
legal financial sources to see how they could be cleared. A Public Debt
Office had been established with officials and staff ready to work in close
cooperation with every bank.
The approach to clear debts owed to loan sharks would be
carried out by setting up negotiations with them, to restructure debt
payments or for refinancing the debt through financial institutions.
GSB would handle debt in the general sector, while the
Bank for Agriculture and Agricultural Co-operatives would manage debt in the
agricultural sector and the SME Bank would become involved with debt
incurred by small enterprises, Korapoj said.
Chaleaw Sangsuwan, vice-president of the Nong Seng
community, Tambon Watgate, welcomed the joint initiative between the GSB and
the government “Because it means the poor are offered a chance to earn a
living and free them from debt owed to loan sharks.”
However it is difficult to see how a 15,000 baht loan
will produce enough income to service the loan and pay it off within 12
months, plus interest. Another side to Amazing Thailand?