Household Debt Soars to Record High in Thailand, Prompting Urgent Government Action

Record High Household Debt in Thailand

The average household debt in Thailand has hit a staggering 606,378 baht, reflecting an 8.4% increase from the previous year, based on a recent survey conducted by the University of the Thai Chamber of Commerce in early September. This marks the highest figure since the survey began in 2009, exacerbating the economic woes facing Southeast Asia’s second-largest economy.

Economic Implications of Rising Debt

As household debt climbs, it weighs heavily on the country's growth potential. Presently, the total household debt stands at 16.4 trillion baht, accounting for 90.8% of GDP as of March 2024. This metric places Thailand among the highest in Asia, trailing behind only Malaysia and Singapore in terms of the debt-to-GDP ratio.

Government and Central Bank Responses

• The government is under increasing pressure to address debt servicing issues, as a large segment of the population faces difficulties in managing their debts.
• Finance Minister Pichai Chunhavajira has identified the need for immediate action to assist retail borrowers.
• New Prime Minister Paetongtarn Shinawatra has committed to prompt economic stimulation efforts.

Financial Handouts and Support Measures

In a bid to relieve families burdened by debt, the government announced a major handout of 145 billion baht, intended for state welfare cardholders. This initiative marks the first stage of a broader digital wallet program aimed at supporting up to 50 million people.