Thailand's Finance Ministry to borrow money from Bank of Agriculture and Agricultural Cooperatives to pay farmers for rice-pledging scheme, says senior government official

February 13, 2014 () – The Finance Ministry has resolved to borrow from the Bank of Agriculture and Agricultural Cooperatives (BAAC) to pay farmers for the rice pledging scheme, a senior official said today.

Caretaker Deputy Finance Minister Benja Louicharoen said the loans from BAAC would be in accord with a Cabinet decision on September 3 last year which asked the ministry to find financial sources for the subsidy programme.

The Cabinet resolution was intact but commercial banks stopped lending after the House dissolution, she said.

Naris Chaiyasutr, Treasury Department director general, said the Small and Medium Enterprise Development Bank (SME Bank) would offer factoring loans to rice mills to boost their liquidity so that they could lend to farmers who have delivered rice and possessed receipts under the rice scheme.

Farmers who deliver rice to rice mills under the programme are given receipts which could be cashed with the BAAC.

The SME Bank Board of Directors would discuss and announce a clear-cut policy on factoring loans soon in an effort to relieve farmers' financial burden, he said.

Mr Naris, board of directors chairman, said the SME Bank had always offered factoring loans to rice millers for similar purpose. - MCOT

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