Formal Credit for Farm and Non-Farm Enterprises in Rural Areas of Thailand

This paper reviews recent developments in rural finance in Thailand. Formal credit supplies for farm enterprises have sharply expanded since 1975 due to government quotas for commercial bank lending. Rural nonfarm enterprises, however, have been largely ignored. Most lending to nonfarm enterprises by specialized agencies is concentrated in and around Bangkok with limited impact on agriculturally related activities. Little information is available on the nature of demand for borrowing. Systematic study of the current' credit .supply situation and ways to improve it are required if Thailand is to meet the stated objective of assisting the small-scale sector to play a more dynamic role in the economy