Implementation of the credit card system is being overseen by the Bank for Agriculture and Agricultural Co-operatives (BAAC).
BAAC manager Luck Wajananawat said the bank had agreed to set up an initial B1 billion three-year contract with a credit card provider. Of that budget, B360 million will be spent on issuing three million credit cards.
Mr Luck said that the BAAC credit cards will be issued in two phases. The first phase will be limited to payment for agricultural production costs from various co-operatives and over 3,000 stores affiliated with BAAC nationwide, with the number expected to rise to 5,000 shops in the following years.
The cards will offer a maximum loan limit of 70 per cent of the value of each farmer-debtor’s product for sale. They will carry a seven per cent interest rate, or zero per cent in cases where a subsidy is provided by the government.
Other benefits touted to the farmers include: no annual fee; a 30-day interest-free period; free life insurance of up to B100,000; emergency cash loans of B10,000 and special interest rates for cash deposits.
Promotions from networked stores cover discounts, point-of-sale collections for gifts or other rewards.
In the second phase, farmers will be able to withdraw cash, make payments along with other services as offered by other service providers.
Mr Luck said some B20 billion turnover is expected in the credit system in the first year, B45 billion in the second year, and about B70 billion in the third year. – MCOT