Bank of Thailand Launches 'SMEs Secure+' Program with Flexible Collateral Requirements to Boost Small Business Lending

The Bank of Thailand introduced the 'SMEs Secure+' measure on May 11, 2025, designed to increase SME lending by temporarily relaxing assessment criteria for 12 months, with collateral value substituting for cash flow analysis to support business liquidity. Bank of Thailand Governor Vithai Rattanakorn explained that amid high uncertainty in the Middle East, the central bank has prepared support measures, with 'SMEs Secure+' being a key tool that allows financial institutions to consider collateral value alongside borrowers' cash flow rather than relying solely on current financial status, which may be temporarily affected and not representative of normal conditions.

The 'SMEs Secure+' program targets businesses with collateral but unable to access credit under normal circumstances, accepting two types of collateral: existing collateral from customers affected by Middle East developments whose cash flow has been disrupted and business income or profits have declined, and new or unencumbered collateral. The program's distinguishing feature is that the Bank of Thailand is sending unprecedented signals to financial institutions to relax guidelines, allowing banks to treat temporarily reduced cash flow or income during the affected period as a secondary factor rather than the primary consideration in credit assessment. Banks will be allowed to evaluate borrowers' normal-period income-generating capacity instead, and existing collateral will not require reanalysis, increasing opportunities for both financial institutions to disburse credit and businesses to obtain approval. The relaxation will be temporary, lasting 12 months.

Governor Vithai noted this is unprecedented in the central bank's history, stating: "The Bank of Thailand has never before relaxed cash flow assessment criteria on a temporary 12-month basis, but to support SMEs affected short-term by rising oil and raw material prices that have reduced profits or disrupted cash flow, we're making credit access easier. Banks are expected to roll out products within one to two months and continue communicating through their branches." Sakdachai Peechapatana, TISCO Group CEO, said the 'SMEs Secure+' program is Bank of Thailand policy developed with the Thai Bankers Association to help customers needing liquidity, as SME liquidity has contracted. The central bank adjusted criteria to be more flexible, emphasizing collateral from those owning land, homes, or vehicles as personal assets or family-owned property.

Sakdachai explained that this customer segment may previously have been classified as Stage 2 or special mention (SM), with financial institutions hesitant to lend due to visible cash flow weakness. This group, needing credit but unable to obtain it, might otherwise turn to non-formal lending or non-bank financial providers offering higher interest rates than the formal banking system.