The Government Savings Bank (GSB) forecasts around 200,000 to 300,000 individuals will secure loans worth 20 billion baht under the People's Bank project.
During the first five months of this year, the bank extended loans totalling 17.9 billion baht to 171,000 accounts, said president Worawit Chalimpamontri.
As of May, the project's outstanding credit was 55 billion with non-performing loans of 3.08%.
The People's Bank project was initiated by former prime minister Thaksin Shinawatra with the aim of allowing low-income earners access to funds from banks instead of loan sharks.
The project charges a flat interest rate of 0.75% per month.
However, the bank announced on Monday it will cut the interest rate by 25 basis points to 0.50% per month for those who borrow less than 100,000 baht from project from July 2 to the end of this year. Borrowers during this period will also be entitled to a longer repayment period of eight years instead of five years.
The GSB has extended accumulated loans of 158 billion baht through the People's Bank project over the past 12 years, he said, with 3.31 million accounts.
The project's annual lending growth rate averaged over 10% per year, he said.
Mr Worawit attributed the loan growth to lower collateral requirements a few years ago, increasing the credit limit to 200,000 baht per borrower from 15,000 baht when the project started, and cutting the interest rate to 0.75% from 1.00% per month.
About the author
- Writer: Wichit Chantanusornsiri
Position: Business Reporter