Last week, the financial sector faced major drama when CLICX, a branchless bank recently launched, began offering online loan applications but had to temporarily suspend the system after only 1-2 days. This occurred following posts by some “debt dodgers” in groups claiming that even those with poor credit could get loans and they could simply default without consequence.
Although the exact reasons why these debt dodgers believe they can borrow without repaying remain unknown, Thairath Money invites readers to examine common financial misconceptions about debt to avoid falling into such traps.
1. Digital loan apps with no physical branches can't pursue debt collection.
The truth: Virtual banks like CLICX are licensed by the Bank of Thailand and must provide services and charge interest rates according to Thai law. Borrowers are obligated to repay. If they default or engage in fraudulent behavior, the bank will take legal action against offenders.
Therefore, this is not a scam app or an illegal loan app charging unlawful interest rates. Choosing to default will have consequences such as a poor financial record, potentially making future bank loans more difficult.
Note: CLICX is a joint venture between Krungthai Bank (KTB), Advanced Info Service (ADVANC), and PTT Oil and Retail Business (OR).
2. Borrowing through digital platforms means no debt collection system; collection will be slow.
The truth: Many borrow through e-commerce apps for purchases ranging from tens to tens of thousands of baht, thinking they can default since these are digital and collection is ineffective. However, most of these apps are also licensed by the Bank of Thailand. Products like Shopee's SPayLater report data to the National Credit Bureau (NCB), so defaults and late payments are recorded in the system.
3. Being listed in the credit bureau means you cannot get loans.
The truth: The belief that being listed in the credit bureau automatically denies loans is false. The National Credit Bureau collects loan and repayment data monthly from member financial institutions.
Loan applications may be denied if banks find that a person has multiple loans exceeding their income or a history of default. Lenders have the right to choose whom to lend money to. Bank of Thailand regulations require banks to clearly explain reasons for loan rejections.
4. Unsecured loans mean the lender cannot take action if you default.
The truth: Unsecured loans such as credit cards, personal loans, and cash cards don’t require collateral at application.
However, if you default, creditors can sue you. If you refuse to pay, avoid negotiation, or ignore debt restructuring, and the court rules against you, assets registered in your name can be seized or frozen. In some cases, your salary can be garnished if you are a private-sector employee earning over 20,000 baht. Officials from the Department of Legal Execution will seize or auction your assets to repay creditors.
5. Defaulting on debt leads to imprisonment.
The truth: Debt from borrowing is a civil matter, not criminal. Therefore, defaulting does not result in arrest or imprisonment, except in cases involving fraud or financial document forgery, such as knowingly issuing bad checks, which carries criminal penalties.
This question arises frequently. We asked Athip Sinpajikan, CEO of Ayudhya Capital Services Co., Ltd., who told Thairath Money that when a debtor defaults, financial institutions may pursue debt collection through legal procedures, such as:
(Note: Each company and loan type has different legal conditions; check carefully.)
Each financial institution, whether bank or non-bank, has policies and timelines for debt collection but must comply strictly with the Debt Collection Act as mandated by the Bank of Thailand’s Market Conduct standards. Violations can lead to criminal and civil penalties, such as for aggressive debt collection or assault.
"Once a loan becomes non-performing, the provider may file lawsuits to recover debts, regardless of the amount owed, depending on the company’s policy," Athip explained.
After legal action, options include negotiating with the debtor, asset investigation and protection, and seizing assets or wages, but all require a court judgment. Wage garnishment rules ensure borrowers retain enough money for living expenses.
In conclusion, from an honest standpoint, "borrowing means repaying." Creditors must collect debts to maintain business cash flow, but if debt collection is unfair, borrowers can file complaints. For questions or problems with loans or debts, you can consult the Bank of Thailand at Call Center 1213 or.
SourcesBank of Thailand,CLICX
Read personal finance and financial planning news with Thairath Money to help you achieve "Good Finance, Good Life" athttps://www.thairath.co.th/money/personal_finance
Follow the Facebook page: Thairath Money at this linkhttps://www.facebook.com/ThairathMoney