Vorapak Tanyawong, former CEO of Krungthai Bank and a frontrunner for the post of deputy finance minister, posted on his personal Facebook page calling for an end to misapplied interest-rate caps on retail loans. He argued it is time to implement risk-based pricing (RBP) as a sustainable solution for informal debt.
“Risk-Based Pricing is the future of Thai lending: higher-risk borrowers can access credit, lower-risk borrowers pay less,” he said.
This concept is not merely a policy slogan. It represents a fundamental shift in thinking about financial fairness, which Thailand is beginning to pursue seriously under the Reinvent Thailand initiative, a new economic strategy for the country’s future.
Signals from the Bank of Thailand
On September 12, 2025, the Bank of Thailand, Fiscal Policy Office, the Thai Bankers’ Association, and three retail-lending providers held their first joint meeting to kick off the design of a risk-based pricing mechanism in Thailand.
The meeting marked a turning point for the Thai lending system. RBP is not just about lowering interest rates for responsible borrowers. It also opens the door for previously excluded high-risk borrowers to re-enter the formal financial system fairly and sustainably.
Previously, debates over interest-rate caps were seen as consumer protection. In practice, overly low caps, such as 25% per year, acted as a double-edged sword:
- Lenders were unable to extend credit to high-risk borrowers.
- Many borrowers had no choice but to rely on informal lenders charging 60–200% annually.
- The financial system could not build credit histories for a large segment of the population.