Thailand Cuts State Bank Fund Contributions to Boost SME Relief

Deputy Prime Minister and Finance Minister Ekoniti Nititundtrapaisal announced a comprehensive SME support initiative directing state banks to channel reduced fund contributions into the "SME Credit Boost" and "Quick Debt Closure" programs. The Finance Ministry expressed concern over rising debt among small and medium enterprises and said it has been working closely with the Bank of Thailand to address SME problems as a special case. Existing measures with commercial banks are progressing well, particularly the "SME Credit Boost" program, which has begun disbursing credit into the system and giving entrepreneurs greater access to funding alongside the "Quick Debt Closure" initiative. To expand assistance further, the Finance Ministry is preparing a policy for state-owned financial institutions to help SMEs in parallel with commercial banks, with a key measure being reduced contributions to the special financial institution development fund. Nititundtrapaisal explained that the reduction in state bank contributions would free up liquidity to fund targeted SME projects, including state bank versions of "Quick Debt Closure" and "SME Credit Boost," while maintaining financial institution stability. He also noted that the Small Industry Credit Guarantee Corporation would support the SME Credit Boost program to encourage lending. On budget adequacy, he confirmed current funding is sufficient but emphasized the need to time disbursements carefully, and tasked relevant agencies with calculating exact amounts freed from reduced state bank contributions to design programs with maximum benefit to SME operators.