BAAC and farmers' debt3 steps to sufficiency

As a stateowned financial institution, the Bank for Agriculture and Agricultural Cooperatives' major customers are farmers from 5.91 million house¬holds. Its lending has reached Bt420 billion, of which 4.9 per cent is nonperforming loans.

As the government's financial arm, the bank is to provide soft loans, special loan packages and also a debtsuspension programme fol¬lowing Cabinet orders.

Shouldering the huge debt, the bank has applied His Majesty the King's initiative on the sufficiency economy to design a threestep selfdevelopment programme since last year. Three key principles of the pro¬gramme aim to encourage farmers' selfreliance, community reliance and linking the network with other communities.

Since last year, a programme called "Model Community for the Sufficiency Economy" has been seeking to improve the lot of farm¬ers. So far, the model has been estab¬lished in 914 communities nation¬wide, covering 77,506 farmers.

Those farmers have been quali¬fied by the BAAC to pass the first step on development of selfreliance. It means they can manage expenses on their own incomes while reducing debts.

The bank is preparing to promote them into the second step on devel¬opment of community reliance, encouraging people in the commu¬nity to create businesses or products on their own initiative to generate income.

Ennoo Suesuwan, senior execu¬tive vice president of the bank, said many activities could be promoted by concentrating on a community's strength and its people's interests.

For instance, the bank will sup¬port a community to set up savings cooperatives that require only one baht of savings per day. The fund from the cooperatives will be used for the welfare of members and also encourage businesses in the com¬munity.

Other interesting developments under the programme include organic fertiliser, organic vegeta¬bles, garbage banks, tree banks and community shops.

Ennoo said the successful pro¬gramme had generated extra income and benefit to farmers. People in developed communities are able to repay 90 per cent of their debts.

"The bank's officials find it more convenient as they do not go out every day to ensure debt repayment - instead our customers have walked in to deposit money," he said.

So far, the programme has attracted all members of the com¬munity, not only BAAC's clients but also monks, teachers and tambon administration officials.

The BAAC has targeted setting up 999 model communities, while some 2,000 to 3,000 communities have proposed joining.

So far, 611 communities are at the stage of firststep development and 288 have been promoted to the sec¬ondstep programme.

Ennoo said the bank hoped the bank's customers would rely more on the sufficiency economy and be able to create extra income on their own. In addition, it is a direct way to reduce the bank's nonperform¬ing loans.