Thailand sets 50-billion-baht fund to help 700,000 small and medium businesses

To give small and medium-sized enterprises (SMEs) easier access to financial resources after experiencing difficulties caused by the COVID-19 pandemic, the Deputy Prime Minister, Dr. Somkid Jatusripitak, has directed the Office of SMEs Promotion (OSMEP) to boost liquidity to help small businesses in particular.

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In response to Dr. Somkid’s orders, the OSMEP will submit a proposal to the cabinet on July 7, requesting a 50-billion-baht budget to set up a fund to help some 700,000 SMEs. The government will allocate another 50 billion baht to help struggling businesses.

“The first thing that the OSMEP has to focus on is improving liquidity, so that they’re able to access loans from banks. This is important. But if you say that there’s adequate liquidity, does it mean that you have a lower standard First take 100,000 to improve liquidity. However, I want more flexibility. If they can get the cabinet to approve the 50-billion-baht budget, I think the amount will be 50 billion plus 50 billion. The money will come out in separate tranches to ensure its effectiveness,” said the Deputy Prime Minister.

The OSMEP Director, Dr. Veerapong Malai, said the OSMEP fund will be able to aid businesses a month after receiving approval from Cabinet. The OSMEP will lay down loan conditions, while state-run banks will grant loans to qualified SMEs with a good debt repayment history. For instance, they must not miss or delay payments for more than four installments.

The financial aid will be divided into two parts of 100,000 baht and 1 million baht, with an interest rate of 1 percent per year. The loan term is 10 years, with suspension of principal and interest payments for the first six months.

The OSMEP will also support entrepreneurs, who wish to access the government’s procurement and employment market, which was valued at 1.3 trillion-baht last year. The market has increased 30 percent, and it will help entrepreneurs generate at least 400 billion baht in income. The measure is expected to be finalized this September or October.(NNT)