Thai Cabinet approves temporary relaxation of Capital to Loan Ratio Requirement

August 3, 2020

BANGKOK - In an attempt to support the business sector during the COVID-19 pandemic, Thailand's Cabinet has approved in principle relaxation of the capital-to-loan ratio requirement of 1:7 under the Foreign Business Law for non-financial institutions (e.g. companies conducting leasing, credit card, personal loan, and nano finance businesses).

Lawyers Baker McKenzie say the relaxation will give non-financial institutions incentive to inject new cash into their operations in the form of either capital or loans -- without being subject to the ratio requirement imposed by licenses issued under the Foreign Business Law.

"This flexibility will ultimately benefit their customers and the public as a whole," BM says. BM believes the Ministerial Regulation will be issued soon. (ATI).