• Published on 25 July 2017
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Thailand's central bank tightens rules on unsecured consumer loans

Thailand's central bank announced new rules to tighten controls on credit cards and unsecured personal loans amid concerns about high household debt and rising bad loans.

The measures, effective on Sept. 1, include a reduction on personal credit limits for new credit card applicants from the current five times their incomes.

They also include a cut in the maximum credit card interest rate to 18 percent from 20 percent, Deputy Governor Ruchukorn Siriyodhin told a news conference.

Credit card applicants with a monthly salary of less than 30,000 baht ($895.26) will have a credit line of up to 1.5 times their income, she said.

The credit line for new personal loan applicants with monthly income below 30,000 baht will be limited to 1.5 times their income, and they will be limited to 3 accounts each, Ruchukorn said.

The move is likely drag on earnings of credit card issuers and consumption, which has already curbed by high household debt levels and a fragile economic recovery.

Re-disseminated by The Asian Banker from Reuters