Six state banks have reduced their lending rates by 0.25%, which will benefit 18 million account customers. In addition, they have introduced a new savings account.
The banks’ decision to cut the minimum retail rate (MRR) by 25 basis points for a six-month period is a response to the prime minister’s call to action. It reflects a commitment to responsible lending and a recognition of the need to support vulnerable customers.
Prime Minister Srettha Thavisin has been a vocal advocate for this change, urging the central bank to lower interest rates from their decade-high levels to support businesses grappling with high household debt and the economic impact of China’s slowdown. The Bank of Thailand (BoT) has been encouraged to push local banks to reduce lending rates, especially for fragile groups, to foster a more inclusive economic recovery
State Banks Respond to Thai Bankers Association’s Announcement
Six state banks have followed the Thai Bankers Association’s lead by cutting their lending rate for small borrowers by 0.25%. This decision will take effect on May 1, in alignment with the MRR decrease of 0.25% for creditworthy customers over the next six months.
The six banks implementing this adjustment are the Government Savings Bank, Government Housing Bank, SME Development Bank, Export-Import Bank of Thailand, Thai Credit Guarantee Corporation, and Islamic Bank of Thailand. EXIM Bank specifically stated that its prime rate will decrease from 6.60% to 6.35%, marking a total reduction of 0.40% in lending rate.
Benefits for Customers
Government Housing Bank president Kamonphob Veerapala disclosed that the institution’s creditworthy clients can expect a decrease in the lending rate from 6.795% to 6.545% from May 1 onwards. Additionally, the bank is introducing a new savings account offering an interest rate of 1.95% for amounts up to 200,000 baht, aiming to promote savings behavior among its 18 million customers.
