About 96% of Thai labours are in debt, with an average debt amounting to almost 140,000 baht for a household, according to the University of the Thai Chamber of Commerce’s survey released ahead of the Labour Day on May 1.
The UTCC’s Center for Economic and Business Forecasting conducted a survey on debt problem on about 1,200 labourers with monthly earnings of less than 15,000 baht.
The survey, released on Thursday (April 26), found the highest recorded debt incursion in 10 years since 2009.
The center director Thanawat Pholvichai said the survey found that 96% of the total labour force were in debt and total average household debt amounted to 137,988 baht per household with each of the labour household has a monthly installments payments of 5,326 baht.
He said, however, it was fortunate that 65.4% of their loans are legitimate or official loans which carries an interest rates of 10.6%.
The rest 34.6% are unorganized loans which lenders would charge them 20% interest per month. In such a huge borrowing rate, he said labourers then often defaulted their loan payments to these loan sharks.
They borrowed to cover daily expenditures, make payments of their motercycles, cars and repay business venture debts, he said.
The survey also found that more workers are having problems meeting monthly installment payments in the past one year period mainly due to lower earnings, rising expenditures and lack of savings, Mr Thanawat said.
He said this is why workers had repeated their calls for the government to raise minimum wages and enforce stricter controls on consumer goods prices.