Vehicle Title Loan Governed, BOT requires the player must have license, Interest Rate capped 28%-36%, Starting from November 2018


BOT has finalized on the regulation to govern the vehicle title loan, by requiring the players to do registration within 60 days, and the interest rate is capped 28%-36%, subject to the scale of the operators.

Miss Daranee Saejoo, Senior President of Financial Strategy Department of BOT, revealed that BOT provides a regulation to govern the vehicle title loan which requiring the lender without license to apply for the license within 60 days and those who already obtain Personal Loan (P-Loan) license from BOT shall notify the BOT and continue the business operation as usual. The license can be issued and retrieved from the Ministry of Finance.

For the larger operators, the registration capital shall not be less than 50 Million Baht, and the interest rate charge is not more than 28% per annum. There is no limitation on the credit line, which shall be subject to its underlying asset’s value. The loan collecting fee shall be subject to the actual costs. The smaller operators shall be under PICO license which can operate only at provincial level and having registration capital not less than 5 Million Baht. The credit line is limited to not more than 50,000 Baht per person. The interest rate is capped at 36% per annum plus actual collecting fee.

However, BOT’s public hearing on the draft will be held on 28 th September-12th October 2018 and will announce and activate the new vehicle title loan regulation in November 2018. This shall also include the banks and financial institutions.

Today, there are approximately more than 1,000 players, making loan receivable of 200 Billion Baht. In the past, there is no specific regulation to govern this industry. Some lenders were charging verey high interest rates, for example, the motorcycle title loan was charging from 25%-65% per auum, the car title loan was charging from 20%-50% per annum. The three biggest players are Srisawad, NTL and MTC, having totaled 50% of market share.