NESDC warned to monitor the trend of non-performing loans in the housing sector, particularly for home loans under 3 million baht.
The National Economic and Social Development Council (NESDC), Secretary General Danucha Pichayanan said household debt in the fourth quarter of 2023 expanded at a slower pace,
while the quality of loans deteriorated across all types.
Key issues to focus on include monitoring the trend of non-performing loans in the housing sector, particularly for home loans under 3 million baht,
and promoting measures to encourage severe persistent debtors to participate in debt resolution programs.
In the fourth quarter of 2023, household debt totaled 16.36 trillion baht, marking a 3 % increase,
which indicates a slowdown from the 3.4 % growth observed in the previous quarter. The household debt-to-GDP ratio was 91.3 %, a slight increase from the last quarter.
Household debt expanded at a slower pace for nearly all types of credit,
except for credit cards and personal loans, while auto loans contracted.
Households’ ability to repay debt declined across all loan types.
Non-performing loans in commercial banks was 158 billion baht, accounting for 2.88 % of total loans,
up from 2.79 % in the previous quarter.
Key issues regarding household debt that need attention
- 1) The rising trend of non-performing loans in housing credit, particularly for home loans under 3 million baht, which typically belong to middle- or lower-income households. Monitoring and restructuring the debt for this group is essential to mitigate the risk of bad debt;
- 2) Accelerating financial institutions to promote debt resolution measures to severe persistent debtors, which was enforced since April 1, 2024. Effective communication and tailored solutions for individual debtors are crucial for the success of these measures, ensuring benefits for all parties involved.
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