"We have no concern about non-performing microfinance loans at 6%, which is higher than the global standard of 5%, given the different practices of each country in terms of loan approval criteria and debt collections," said managing director Piyasak Ukritnukun.
A unit of
According to Mr Piyasak, the company has no specific plan to reduce bad microfinance loans to meet the global standard.
The existing 6% level of Ngern Tid Lor is deemed acceptable.
The company has gradually expanded the business, aiming at sustainable long-term growth.
"We target grass-roots customer segmentation, financial advice and education as key factors to control asset quality and help low-income borrowers avoid the shark-loan cycle," Mr Piyasak said.
Most of the company's microfinance clients escaped the underground loan market to seek cheaper and safer borrowing.
Ngern Tid Lor has about 2,500 microfinance accounts representing outstanding loans of
The company aims at microfinance loan growth this year of
Plans call for expanding in 22 more fresh markets nationwide, with a focus on provincial areas, to aid loan growth this year.
Ngern Tid Lor has partnered previously with 50 markets, of which 34 are in
As microfinance remains a pilot project, the business segment continues to run losses caused by a high cost-to-income ratio of 130% compared with 60% across the company's overall portfolio.
(c)2014 the Bangkok Post (Bangkok, Thailand)
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