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Financial Sector Master Plan Phase II (English)

Financial Sector Mater Plan Phase II (Thai)
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Dec 2, 2009
Most victims of loan sharks appear to be reluctant to register for the government's refinancing scheme.

Officials say it is unclear whether they believe they can wait before crying for help or are simply too afraid of their creditors to come forward.

Many loan sharks reportedly use violent means to collect repayments. The Justice Ministry's People's Debt Problem Centre has received more than 100 complaints about the intimidating methods of loan sharks. Yet some of the "robust" debt collectors are these days government officials under cover.

The Office of the Public Sector Anti-Corruption Commission is now investigating the alleged use of threats against debtors.

On the first day of registration for the government's refinancing scheme yesterday, very few people showed up. People who want the government to help negotiate debt repayments with unregistered moneylenders must register themselves under the scheme by December 30.

In Chiang Mai, the Government Savings Bank's Area 1 branch arranged extra chairs in its public area in anticipation of a large number of people arriving to join the government's refinancing scheme. When the branch began registration at 8am, only five people had arrived, and of those only one proceeded to register. The others made inquiries and left.

There was also a lukewarm response at Chiang Mai branches of the Bank for Agriculture and Agricultural Cooperatives. After opening 27 registration places in the city, very few people turned up.

"We have prepared Bt100 million to refinance the debts of people registering with us in Chiang Mai," a bank official, Sakchai Khamruangrit, said. "Perhaps more people will come forward later this month."

There was a similar reluctance to rush to register for the government's scheme in Songkhla and Nan, but there was an "enthusiastic" response in Surat Thani and Khon Kaen.

Across the country, only 17,000 people registered yesterday as victims of loan sharks and sought the help of the government's refinancing scheme. Yet it is estimated that millions of Thais have obtained loans from "informal", out-of-the-system lenders.

Despite the government's intervention, one unregistered moneylender yesterday expressed confidence the out-of-the-system money-lending business would continue to thrive.

"When people suddenly run short of money, they need quick cash, and registered financial institutes cannot give them that," she said.

Identifying herself simply as Su, she claimed to have lent Bt200,000 to people in Khon Kaen.

"I charge them monthly interest of 10 per cent," she said.

Source: The Nation
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