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BoT Allows Cross-Bank Debts Consolidation

THailand Credit Cards Household Debt

People struggling under credit cards and loans from different banks can now refinance and consolidate their debt to reduce interest burdens.

 Bank of Thailand Assistant Gov. Roong Mallikamas, who supervises the Financial Institutions Policy Group, said Monday that the central bank will support financial institutions in consolidating mortgage and retail loans to help debtors who have good repayment discipline or were affected by Covid-19.

In such cases, collateral from mortgages can be used to reduce interest and installments for a long period.

Besides, the BoT eased rules on debt refinancing to encourage financial institutions to compete with each other in debt consolidation for customers. It temporarily suspended any fine on the early repayment of personal loans and nano finance it supervises.

The measures will take effect until Dec 31, 2023. The debt consolidation can cover loans from different financial institutions compared with the previous rule that limited the consolidation within the same financial institutions.