Peer-to-peer. Lending in Thailand

Peer-to-peer lending (P2P or person to person or Peer-to-Peer) is a way of borrowing money from individual without the involvement of a bank or other financial institution.

Loans are provided online using lending platforms and credit check tools.

Is there P2P lending in Thailand?

P2P lending officially exists in Thailand since April 29, 2019 after the appearance of the first regulatory act concerning this question (Notification 4/2562 Re: The Determination of Rules, Procedures, and Conditions for Peer-to-Peer (P2P) Lending Businesses and Platforms).

Who can be a P2P Platform Provider?

1. A private company or public company incorporated in Thailand;

2. Not a banking or financial institution (except for their subsidiaries);

3. Paid in capital of at least 5 million baht;

4. At least 75% of the shares should belong to Thai citizens.

5. The director of the company may not be a person who was previously accused or prosecuted under the article fraud or corruption.

The provider is prohibited from holding the money, property and securities of creditors and borrowers, it is necessary to involve a third party for that - a qualified custodian. The custodian must either be an authorized custodian under the rules of the Securities and Exchange Commission (SEC) or an authorized commercial bank (for escrow accounts) under the rules of the Bank of Thailand.

Borrowers

Borrowers may be individuals who:

- Have the capability to incur debts

- They are not P2P platform providers

- They are not directors, authorized persons or majority shareholders of the provider

- They received personal loans from less than three different lenders.

Limits of loan amounts

Consumer loan - the credit limit depends on the income of the borrower. If the average monthly income is less than 30,000 baht, the credit limit cannot exceed the amount of income by more than 1.5 times. If the average monthly income is 30,000 baht or more, the credit limit cannot exceed this amount by more than 5 times. The average income should be calculated for a period of less than six months.

If the loan is intended for commercial purposes, the credit limit is set at 50 million baht.

The interest rate on loans provided through the P2P lending platform should not exceed 15% per year.

Lenders

Lenders can be both individuals and juristic persons. Lenders must have experience and understanding of the nature of lending and the associated risks. The lender cannot be a platform provider. For private lenders, the amount of all loans should not exceed 500,000 baht for one year.

For all questions of organizing a P2P platform, contact: 087-348-57-03

Author: Alexandra Agapitova

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