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Bangkok Post
6 days ago
- Business
- Bangkok Post
Are damaged Thai banknotes still usable?
Whether damaged Thai banknotes are accepted generally depends on the discretion of individual vendors. Minor damage, such as a small tear at the corner, often does not prevent their use for payment. However, if the banknote is significantly damaged, such as being torn by 20% of its size, and the user is unsure whether it can be used, the note can be exchanged for a new one at a bank, under the conditions set by the Bank of Thailand (BoT), as follows: 1. Banknotes with over 60% of the original note remaining If the banknote has only minor damage and can be clearly verified as a genuine government-issued note, it can be exchanged at full face value. No application form is required. These can be exchanged directly at any of the Government Savings Bank (GSB) branches nationwide. 2. A half banknotes If the banknote is split into two parts down the middle (lengthwise), each half can be exchanged for half of the note's original value. For instance, a 100-baht note torn in half can be exchanged for 50 baht per half. In this case, an application for damaged banknote exchange must be submitted to the bank staff. 3. Mismatched banknotes If the banknote has been pieced together from two different notes, possibly due to a printing error, and both parts are from the same denomination and series, it can be exchanged for the full value. 4. Mutilated or defaced banknote If a part of the banknote is missing but more than half of the original note remains, and the note is clearly verifiable as genuine and not damaged due to intentional acts, such as improper handling, it can be exchanged for its full value. 5. Faded or unreadable banknotes If the banknote is still reasonably recognisable as an authentic Thai note, it can be exchanged at full value. An application must be submitted for examination by bank officials. 6. Burned, chewed, mouldy or stuck-together banknotes These must be presented in person to a bank officer along with a completed application form and a copy of a bank book. If the damage was caused by fire, a police fire report must be attached. The documents and banknotes must be submitted directly to a bank that processes currency claims. If the damage is too severe to verify authenticity on the spot, the note must be sent to the BoT for examination. The verification process may take up to 60 days from the date the claim is received. Banknote Clinic The central bank also operates a Banknote Clinic, which offers off-site services to facilitate the exchange of damaged banknotes. The clinic takes place at different locations each month. Damaged banknotes can also be exchanged at any GSB branch or commercial bank nationwide.
Business Times
15-07-2025
- Business
- Business Times
Thailand to pick rate-cut advocate Vitai Ratanakorn as central bank chief
Thailand is poised to name veteran banker Vitai Ratanakorn as the next governor of the central bank, sources familiar said, selecting an advocate of aggressive interest rate cuts to help revive the nation's faltering economy. Finance Minister Pichai Chunhavajira picked Vitai, president of the Government Savings Bank (GSB), to run the Bank of Thailand (BOT), the sources said, confirming earlier reports in the Krungthep Turakij and Manager media outlets. Pichai declined to confirm if he is nominating Vitai as he headed into a Cabinet meeting on Tuesday (Jul 15) morning. The 54-year-old Vitai is widely seen as a proxy candidate for the Ministry of Finance, and the appointment may renew concerns about the independence of the BOT, which under governor Sethaput Suthiwartnarueput has resisted pressure for rate cuts and a higher inflation target. Similar tensions have been seen elsewhere, with US President Donald Trump having publicly derided Federal Reserve chair Jerome Powell and called for deeper rate cuts from the Federal Reserve. The baht declined 0.4 per cent against the US dollar on Tuesday morning, while the yield on benchmark 10-year sovereign bonds dropped two basis points. While rates are decided by majority vote, as head of the policy panel Vitai is expected to have critical influence over their direction. The central bank last month left the benchmark interest rate unchanged at 1.75 per cent, citing the need to preserve limited policy space to respond to future shocks. The policy rate should be significantly lowered for a sustained period to revive the stagnant economy, Vitai told local media after applying for the governor's role. But more important than rate cuts is the need to ensure commercial banks pass on the reduction to customers. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up 'This is a deep and prolonged downturn, and while interest rate cuts are necessary, they are not enough,' Vitai said, according to a Bangkok Post report on Jun 23. 'Additional supportive measures are required.' The next BOT governor faces a challenging economic landscape, including the region's highest household debt, sluggish credit demand, negative inflation and weakening consumption. Despite a cumulative 75-basis point reduction in borrowing costs since October, growth remains subdued, further threatened by the prospect of a punitive US tariff on Thai exports and a slowdown in foreign tourist arrivals, both critical drivers of the economy. That's on top of domestic instability which earlier this month saw a court suspend Prime Minister Paetongtarn Shinawatra from office. Under Vitai, the GSB spearheaded efforts to provide financial relief to small businesses and households burdened by heavy debt in the post-Covid-19 era. The other finalist in the selection process, Roong Mallikamas, is a deputy governor at the central bank who was widely seen as a continuity candidate. The current governor, Sethaput, has repeatedly spoken of the importance of central bank independence, having repeatedly faced government calls to lower borrowing costs. A backlash from former BOT chiefs and economists last year also helped thwart a government bid to install its favoured nominee as BOT chairman, a separate role that's influential in appointments and other matters. Vitai has defended himself after being criticised by an ex-BOT governor who said the banker wouldn't be able to make independent decisions because of his ties to the government. 'My experience and strong self-identity offer the confidence that I can make decisions independently, based on principles,' he said in a Facebook post on Jul 8. 'Seeking the best interest of the country is important, without being influenced by any group.' Vitai's appointment needs to be officially confirmed, but is on the agenda for the Cabinet meeting scheduled for 10 am in Bangkok, Krungthep Turakij reported. BLOOMBERG
Business Times
15-07-2025
- Business
- Business Times
Thailand to name Vitai Ratanakorn as central bank chief, reports say
[BANGKOK] Thailand is poised to name veteran banker Vitai Ratanakorn as the next governor of the central bank, local media reported ahead of a Cabinet meeting likely to endorse the appointment. Finance Minister Pichai Chunhavajira has picked Vitai, president of the Government Savings Bank (GSB), to run the Bank of Thailand (BOT), the Thai-language newspaper Krungthep Turakij reported, citing unidentified government sources. The Thai-language outlet Manager also reported the appointment. The 54-year-old Vitai is widely seen as a proxy candidate for the Ministry of Finance, with the GSB having spearheaded efforts to provide financial relief to small businesses and households burdened by heavy debt in the post-Covid-19 era. The other finalist in the selection process, Roong Mallikamas, is a deputy governor at the central bank who was widely seen as a continuity candidate. Vitai's reported selection may renew concerns about the independence of the central bank, with incumbent governor Sethaput Suthiwartnarueput having resisted government pressure for interest rate cuts and a higher inflation target. The tensions echo similar pressures on central bankers elsewhere, including in the US, where US President Donald Trump has publicly called for deeper rate cuts from the Federal Reserve. The baht declined 0.3 per cent against the US dollar early Tuesday (Jul 15), while the yield on benchmark 10-year sovereign bonds dropped two basis points. Sethaput has repeatedly spoken of the importance of central bank independence, and a backlash from former BOT chiefs and economists last year helped thwart a government bid to install its favoured nominee as BOT chairman, a separate role that's influential in appointments and other matters. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Vitai himself was recently criticised by an ex-BOT governor who said he would not be able to make independent decisions because of his ties to the government. The banker defended himself in a Facebook post on Jul 8: 'My experience and strong self-identify offer the confidence that I can make decisions independently, based on principles. Seeking the best interest of the country is important, without being influenced by any group.' The next BOT governor faces a challenging economic landscape, including the region's highest household debt, sluggish credit demand, negative inflation and weakening consumption. Despite a cumulative 75-basis point reduction in borrowing costs since October, growth remains subdued, further threatened by punitive US tariff on Thai exports and a slowdown in foreign tourist arrivals, both critical drivers of the economy. That's on top of domestic instability which earlier this month saw a court suspend Prime Minister Paetongtarn Shinawatra from office. Vitai's appointment needs to be officially confirmed, but is on the agenda for the Cabinet meeting scheduled for 10 am in Bangkok, Krungthep Turakij reported. Although interest rates are decided by majority vote, Vitai, as the head of the policy panel, is expected to have a critical influence over their direction. The central bank last month left the benchmark interest rate unchanged at 1.75 per cent, citing the need to preserve limited policy space to respond to future shocks. More important than central bank rate cuts is the need to ensure commercial banks pass on the reduction to customers, Vitai told local media after applying for the governor's role. He said the policy rate should be significantly lowered for a sustained period to revive the stagnant economy. 'This is a deep and prolonged downturn, and while interest rate cuts are necessary, they are not enough. Additional supportive measures are required,' the Bangkok Post reported, citing Vitai on Jun 23. BLOOMBERG
Bangkok Post
14-07-2025
- Business
- Bangkok Post
Thai govt loans to cushion blow of Trump tariffs
The Government Savings Bank (GSB) has been ordered to provide 200 billion baht in soft loans to support Thai entrepreneurs hit by US President Donald Trump's tariff measures. According to Finance Minister Pichai Chunhavajira, the GSB loans will charge an interest rate as low as 0.01%, while the bank's cost of funds is around 2%. The government will bear the interest rate differential in order to support the liquidity and inventory carrying costs of domestic entrepreneurs, particularly for small and medium-sized enterprises (SMEs), during this current period of uncertainty. For large companies, commercial banks will step in to help them. But if the burden exceeds commercial banks' capacity then the government will assist, said Mr Pichai. He also addressed measures to prevent the subrogation of certificates of origin (COs) for exporting goods to America, saying it is still unclear what percentage of local content the US will require for products exported to its market. However, it is expected to be higher than the current level of 40%, with the new requirement possibly rising to 60%, 70%, or even 80%, said Mr Pichai He added that for calculating local content for goods exported to the US, America will count domestic raw materials, including those sourced from the US and its allies, as part of efforts to manage competition with rival countries. According to Mr Pichai, in the first round of negotiations with the US regarding market access, which aims at allowing American goods to enter the Thai market at a 0% or near-zero import tariff, Thailand proposed eliminating import duties on 69% of all imported goods from the US. Later, Thailand pledged to eliminate import duties on up to 90% of all goods imported from the US and to remove various non-tariff barriers. Once a final agreement is reached on the tariff negotiations with the US, the entire agreement must be submitted to the Thai House of Representatives for approval, Mr Pichai said. He also noted that certain US goods which are not currently imported into Thailand will also be allowed to enter at a 0% tariff rate, in order to further expand market access and open up the Thai market to US automobiles. Mr Pichai said the guiding principle in the negotiations is that a 0% import tariff for US goods should apply only to products that Thailand already needs to import or to those that can be produced domestically but in insufficient quantities. "The impact of the Trump tariff measures should be seen as a crisis that presents an opportunity for Thailand to adapt and enhance the country's competitiveness," he said. "This is a bitter medicine for every country: we need to understand the situation and move in the same direction. We can't expect to gain 100% because it's a zero-sum game.' He added that Thailand's economy relies heavily on exports — up to 58%, though this is down from a previous peak of 70%. Of that, 18% of Thai exports go to the US, which is relatively high. Mr Pichai emphasised that negotiations with the US must ensure mutual benefit and balance, and the outcome must be sustainable — not just short-term fixes. This, he noted, is a challenging task. Historically, the US has had a trade deficit with Thailand amounting to US$30 billion a year. Therefore, Thailand must open up its market to more US products. Nevertheless, of that $30-billion deficit, one-third consists of electronic goods such as notebook computers, most of which are produced in Thailand by US companies with manufacturing bases in the country. According to Mr Pichai, these US companies have been operating in Thailand for 20-30 years, due to the availability of skilled labour that cannot easily be replaced in the US, as well as the presence of extensive supply chains. Relocating production out of Thailand would be nearly impossible. Products exported by these US firms in Thailand are often components used in America's artificial intelligence industry, he said. At the same time, according to Mr Pichai, Thailand is committed to promoting Thai investment in the US, especially in sectors such as agricultural processing, including both human and animal food, along with investment in energy resource development. The US has relatively low energy costs, particularly natural gas, which is priced at just $2–$3 per million British thermal units (BTU), compared to $11 in the international market. He added that Thailand must adapt by increasing reliance on its domestic economy. This includes maximising the use of domestic resources in production for overseas sales and diversifying export markets. However, Mr Pichai cautioned that if the negotiations adversely affect third countries, Thailand must take that into consideration as well, since part of these negotiations involves geopolitical issues, and the country does not wish to bring foreign conflict into its own borders.
Bangkok Post
03-07-2025
- Business
- Bangkok Post
State bank to help 2m vulnerable people
The Government Savings Bank (GSB) has vowed to help 2 million vulnerable people a year access formal credit. According to Vitai Ratanakorn, president of the state bank, the Ministry of Finance and the State Enterprise Policy Office (Sepo) have revised the bank's performance evaluation criteria. Instead of focusing on maximising profits, the new metric is how effectively the bank can help people access formal credit. This approach aligns with the vision of transforming GSB into a social bank, he said. Mr Vitai said a large number of people still have either no credit records with financial institutions or credit scores so low most conventional financial institutions cannot extend loans to them. If loans were granted to this group, he said interest rates would typically be very high, around 25-30%. However, GSB can provide loans to this group at an interest rate of only 12%, said Mr Vitai, who is one of two shortlisted candidates to become governor of the Bank of Thailand. The other is Roong Mallikamas, a central bank deputy governor. Lending to vulnerable groups carries a relatively high risk of default. Out of every 100 borrowers, 20 are estimated to become non-performing loans (NPLs), he said. However, the remaining 80 would be recognised as having a credit record with the bank, enabling the bank to increase their credit limits the following year, said Mr Vitai. While loan programmes for vulnerable groups can result in financial losses for the bank, he said the social bank model compensates for these losses with revenue generated from loans to large businesses. A social bank is a business model where profits from commercial activities are used to subsidise social missions. Mr Vitai said the challenge lies in gaining acceptance from stakeholders. For example, Sepo, which oversees state enterprises, must accept that this approach will reduce GSB's profits, he said. Meanwhile, the Bank of Thailand, which regulates financial institutions, must accept the increased financial risk. GSB must ensure its profits do not drop excessively. A decline of 3-4 billion baht per year is considered acceptable. The bank aims to maintain annual profits at around 20 billion baht, said Mr Vitai. He said GSB aims to help 2 million vulnerable people this year, including 1 million who would normally be rejected by commercial banks, resolving small bad debts by partially forgiving them, as well as forgiving debts for around 500,000 borrowers who took out loans under the Covid relief programme. With these efforts, such borrowers will no longer be classified as NPLs by the bank, said Mr Vitai. GSB offers various types of social credit programmes, including credit-building loans for 'opportunity creation' for individuals with no credit history; job and career creation loans; back-to-school loans; and loans for grassroots and individual borrowers. Roughly 620,000 individuals have received loans under these programmes as of May 2025.
