New move to assist teachers severely in debt

The Committee for the Promotion of the Welfare and Security of Teachers and Educational Personnel (CPWSTEP) has approved a new scheme to assist severely debt-stricken teachers.

Initially, the scheme will apply only to teachers receiving "academic standing" payments - an additional Bt3,500 payment for their positions as "proficient teachers" on top of their normal salary.

Instead of paying high interest rates to loan sharks or credit-card companies, teachers can repay the bank in 60 monthly instalments, or not more than 10 years.

Education permanent secretary Charuaypon Torranin yesterday said the Government Savings Bank loan instalments would match the teachers' academic-standing payment of Bt3,500 a month.

The loan procedure for teachers would not require them to form a group like in the previous Teacher Life Development scheme, but rather submit the documents outlining their high-interest debts, with three guarantors and their supervisor's approval and debt guarantee, said Charuaypon.

If the teachers resign or retire, they must ensure their debts under the scheme will be fully repaid with the minimum lending rate, which is currently 7.75 per cent annually, she said.

Loans will initially be up to Bt70,000 for teachers with credit-card debts and Bt200,000 for teachers with "off system" debts (involving loan sharks), although the bank would have the final say on the exact amount on a case-by-case basis.

CPWSTEP deputy secretary-general Bumrer Baonuwong said that since last February 1, there were 245,500 teachers receiving academic-standing payments, of which 131,217 had registered with the ministry's scheme to sort out their debts.

Out of this group, 34,400 teachers owed credit-card companies a total of about Bt2.4 billion, while 48,907 teachers owed off-system loans of around Bt11 billion, he said.

While the "Teacher Life Development" scheme will remain - lending up to Bt2 million per teacher to clear all of their debts - this new scheme will help those teachers who are severely in debt, said Bumrer.

Teachers' debts have risen quickly, from an average of Bt500,000 per head in 2001 to Bt1 million per head last year.

The CPWSTEP will formulate criteria for the new scheme and inform all educational offices in a month or two, after which teachers should be able to apply for loans under it.

Thailand News
The Nation Thailand
Friday January 26, 2007