Thailand’s debt spiral

Summary

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Business Daily: Thailand’s Debt Spiral

Host: Ed Butler (BBC World Service)
Date: October 12, 2025

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Episode Overview

This episode of Business Daily delves into Thailand’s escalating consumer debt crisis through voices from rural villagers, street vendors, private moneylenders, and international economists. With Thailand facing some of the highest rates of household debt in the world, the episode explores the personal stories of debt, the rise and practices of informal lending, systemic weaknesses, and potential solutions for the spiraling situation.

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Key Discussion Points & Insights

1. Life on the Edge: Rural Debt Stories

• Location: Ban Phu Yuan, a poor rural village roughly 100km north of Bangkok, sets the scene for the episode.
• Villagers are seen collecting scrap metal and working multiple jobs to make ends meet.
• Passive income is a necessity:
  “Everybody has to find passive income, looking for additional jobs to earn more money… Everyone's working all the time.”
  — Villager/Trader (03:09)
• Stagnant wages and rising costs make profit elusive even for industrious street traders, who often earn mere cents per item sold.

2. Hopelessness and Relentless Cash Flow Concerns

• Villagers express a lack of hope for financial improvement, constantly chasing daily cash flow to cover debts rather than saving for the future.
• “We can’t ever hope to save any money.”
  — Villager/Trader (03:31)
• The emotional toll of this financial treadmill is palpable, with hope reduced to covering another day’s debts.

3. Pandemic Fallout & Structural Causes

• Corinne Delasha (IMF, Asia-Pacific Desk):
  Thailand’s high debt-to-GDP ratio was “already high before the COVID pandemic,” but worsened when the tourism sector closed down and mass borrowing became survival.
  — (04:15)
• Elevated debt causes a vicious cycle: higher risks make banks pull back on lending, dampening economic activity, and further eroding borrowers’ ability to repay.
  “So it’s sort of a vicious circle.”
  — Corinne Delasha (04:31)

4. Turn to Loan Sharks & Informal Lenders

• Many villagers, unable to secure formal loans, turn to private “loan sharks” for quick credit, often at exorbitant rates.
• Terms are typically 20% interest for a monthlong loan:
  “When you borrow 100 baht, you have to pay back 120 baht for 36 days.”
  — Loan Borrower “Ball” (07:16)
• On default, social coercion is strong—most people will make every effort to repay, with severe social and sometimes physical consequences for delinquency.
• Ball recounts having to borrow after an accident left him unable to work and pay hospital bills, now struggling with impairments but still driving a motorbike to get by.
  — (06:07–07:42)

5. Profile: A Moneylender’s Paradox

• J A Natterin, a local figure, was once herself on the run from loan sharks during pregnancy—at one point hiding in the mountains to escape harassment (10:07–10:34).
• She now lends to others, calling it a form of “helping people.” Though technically illegal if unlicensed, informal lending fills a critical systemic gap. “So I help everyday people who doesn’t have food, medicine, they want some work, seeds and helping people. Public service like helping people.”
  — J A Natterin (11:15)
• Her rates are 400 baht interest monthly per 10,000 baht borrowed (approx. 20%) with borrowers often rolling debts month to month.
• Enforces repayment primarily via intimidation and aggressive words—her online videos have made her both notorious and somewhat of a celebrity. “I never use violence against the physical, but violence for word, of course I did.”
  — J A Natterin (13:06)
• She was raided and accused of being a loan shark, but avoided indictment.
  — (15:00)

6. Lending Legality, Social Protection, and Financial Literacy

• Corinne Delasha (IMF):
  • Informal lending is illegal; authorities aim to incorporate more borrowers into the formal system, considering data such as utility bill payments.
  • Social protection is insufficient, especially as over half the workforce is informal, with precarious income and little safety net.
  • Financial literacy is low, leading many households to over-borrow and pay only minimums, letting debt snowball.
    “Having a social protection floor that’s more uniform and protects those groups... would help a lot in terms of preventing this borrowing, reacting to shocks, and... less costly to the government.”
    — Corinne Delasha (17:16)

7. Lived Realities and Possible Solutions

• Opinions in the village are mixed: while some resent moneylenders, others see them as fair and necessary given the absence of government support.
  • “What the government can do is that they open a center or institute that provide money for informal workers... this is why people gaining more and more debt because they don’t know how to get money.”
    — J A Natterin (18:22)
• For many, debt is not a choice but a necessity when medical bills or school fees arise unexpectedly.

8. Majority in Debt: No Exceptions

• The episode closes with the stark image of a villager shouting out to his neighbors—they all answer “yes” when asked if they're in debt.
  “Actually, they say, who's not? Who's not?”
  — Villager (19:30)

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Notable Quotes & Memorable Moments

• “All I hope for is cash flow each day to cover my debts. We can’t ever hope to save any money.”
  — Villager/Trader (03:31)
• “It’s among the highest [household debt to GDP] across the world... This level of debt is sufficiently high that it has delayed the post-Covid recovery.”
  — Corinne Delasha (IMF) (04:15 and 04:31)
• “I borrowed 5,000 Baht a month ago, more than a month ago, but I still don’t have time to pay him yet. I just hope for cash flow each day.”
  — Loan Borrower “Ball” (01:29, 07:27)
• “If I point out at someone and start shouting... I will be like angry and aggressive. Are you going to pay or not? ...And they would be afraid of that and try to find some money to return me. So it works for me.”
  — J A Natterin (13:43)
• “Debt is not a choice…”
  — J A Natterin (18:22)
• “Actually, they say, who’s not? Who’s not?” [in debt]
  — Ban Phu Yuan Villager (19:30)

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Key Timestamps

• 01:00 — Ed Butler introduces the debt theme and rural voices.
• 03:09 — Villager describes need for multiple jobs.
• 04:15–04:31 — Corinne Delasha (IMF) on Thailand's household debt.
• 06:07–07:42 — Ball narrates his troubles with debt and informal lending.
• 10:07–13:33 — J A Natterin’s story: from debtor to moneylender.
• 15:35–17:16 — IMF insights on formalizing credit and the social safety net.
• 18:22 — J A on her view of necessary systemic reforms.
• 19:21–19:30 — Universal indebtedness in the village.

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Tone

The episode is empathetic, candid, and sometimes starkly personal, capturing the everyday desperation, systemic failures, and ethical gray zones of Thailand’s rural debt spiral. The inclusion of both borrower and lender perspectives, as well as expert analysis, paints a nuanced picture of a nationwide challenge still searching for lasting solutions.

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Transcript

[Ed Butler]

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[Villagers/Loan Borrowers]

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Yes.

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[Villager/Trader]

You will?

[Ed Butler]

For what?

[Villagers/Loan Borrowers]

It's a big dog.

[Ed Butler]

SAP Concur helps your business move forward faster. Learn [e-mail] hi there. I'm Ed Butler. Welcome to Business Daily from the BBC. Today we're looking at an experience that's familiar to millions of people worldwide. The experience of debt being in too deep with no prospect of escape. We're hearing from villagers in Thailand.

[Villagers/Loan Borrowers]

I borrowed 5,000 Baht a month ago, more than a month ago, but I still don't have time to pay him yet. I just hope for cash flow each day.

[Reporter/Interviewer]

No hope.

[Ed Butler]

Really?

[Villagers/Loan Borrowers]

Yeah. No hope? No.

[Ed Butler]

As a proportion of its gdp, Thailand has some of the highest rates of consumer debt anywhere in the world. We're hearing not just about the economic challenges these people face, but also from the private money lenders and the methods that they use to get repaid.

[Villagers/Loan Borrowers]

Everybody knows that if I point out at someone and start shouting that that is my last door, I will be like angry and aggressive. Are you going to pay or not? And they will be afraid of that.

[Ed Butler]

Borrowers and lenders in Thailand. That's Business Daily from the BBC.

[Reporter/Interviewer]

Wandering through this village, Ban Phu Yuan, which is about 100km maybe north of central Bangkok. It's a rural area and it's very poor. There are Every house next to me seems to be loaded high with junk in their courtyards, just stuff that they're gathering scrap metal, bits of wood for recycling.

[Ed Butler]

The scrap metal dealers with their loudspeakers drive past collecting the junk, making deals Just pennies at a time. Further on, I meet a street trader. Her name's Wan Na. She's cutting up banana leaves to wrap around balls of rice. Everyone here works two or three jobs, she tells.

[Villager/Trader]

You. Everybody has to find passive income looking for additional jobs to earn more money. Nobody wants to stay still and do nothing with this economic situation, everyone's working all the time.

[Reporter/Interviewer]

Are you hopeful that things will get better?

[Villager/Trader]

I don't know. I can't tell you. These days it's like we're selling products without even making a profit. For example, instant noodles. I only make about $0.03 for each pack I sell. I'm not sure about hope. All I hope for is cash flow each day to cover my debts. We can't ever hope to save any money.

[Reporter/Interviewer]

No hope, really?

[Villager/Trader]

There's no real hope? No.

[Corinne Delasha]

So in Thailand, household debt to GDP is very high. It's among the highest across the world. It was already high before the COVID pandemic and then the country was closed for almost two years. And a lot of the workers in the tourism sector lost their income. These people had to borrow to survive.

[Ed Butler]

That's Corinne Delasha. She's the assistant director of the International Monetary Fund's Asia and Pacific desk. She says the high levels of debt that grew in Thailand during the pandemic have stayed high ever since. And that's putting the entire economy at risk.

[Corinne Delasha]

I mean, this level of debt is sufficiently high that it has delayed the post Covid recovery. With the high elevated debt levels and increasing credit risks in the population, banks become more reluctant to extend new loans. And that also dampens consumption and investment. With lower activity and gdp, the potential to repay the loans also decreases. So it's sort of a vicious circle.

[Ed Butler]

The cycle of debt. Outside the shop where I just met the woman vendor, a man is sitting bare chested on a small motorbike. A pair of lopsided reading glasses, balance on his nose. He calls himself Ball, a nickname he says. He's clutching a $0.20 pack of instant noodles, his only meal for the day.

[Villagers/Loan Borrowers]

The economy is not very good. Everything is increased. It's more expensive, but the labor rate, the day rate, they're still the same.

[Reporter/Interviewer]

But you can go for a long time. Sometimes with no work at all.

[Villagers/Loan Borrowers]

Yeah, sometimes they don't have work. So I will stay at home. I wish I could have a job, a regular job.

[Ed Butler]

Paul tells me that a recent road accident caused him to miss work and that's got him into debt.

[Villagers/Loan Borrowers]

I borrowed 5,000 baht because I had a car Accident. That is broken.

[Reporter/Interviewer]

I can see his shoulder is. There's a bonus sticking up in his shoulder. He's obviously not really set properly. This is. Looks like a broken collarbone. Is that when you fell off your bike?

[Villagers/Loan Borrowers]

This one.

[Reporter/Interviewer]

I fell off this motorbike.

[Villagers/Loan Borrowers]

The bone is fine. But now the real problem is about my eyes. I cannot see it clearly. I can see you like a true picture. I can look at you and you have. You have two of you in front of me.

[Reporter/Interviewer]

He's sitting on the back of a moped and he clearly still drives it. But he can't see straight, which suggests it's a bit of a hazard.

[Villagers/Loan Borrowers]

I cannot get any formal loan from any bank or government institution unless we go to Indian Hindi to lending the money. And the interest is about 20%.

[Reporter/Interviewer]

So you go to a loan shark. Basically a private money lender.

[Villagers/Loan Borrowers]

When you borrow 100 baht, you have to pay back 120 baht for 36 days.

[Reporter/Interviewer]

And so you have to pay it back within a month and you have to pay 20% on top of the principal.

[Villagers/Loan Borrowers]

That's correct. I borrow 5,000 Baht a month ago. More than a month ago. But I still don't have time to pay him yet because I was off from work. And I just hope that we will work soon.

[Reporter/Interviewer]

What happens if you don't pay the money back within 36 days?

[Villagers/Loan Borrowers]

I haven't seen people who not pay back. Sooner or later we will try to finish our lending. Unless you die. Then you cannot pay them back.

[Ed Butler]

The words of one indebted villager. You're listening to Business Daily from the BBC.

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[Villager/Trader]

Yes.

[Ed Butler]

SAP concur helps your business move forward faster. Learn [e-mail] I'm Ed Butler and today in Thailand, I'm looking at one of the world's most indebted working populations. Household debt here, who has reached some $500 billion. That's almost as much as the entire national economy produces each year. More than half of all Thais say that without earnings, their savings won't cover them for more than a few months. This is the person that some of them are turning to for loans. Her name is J A Natterin and as you'll hear, she is an extraordinary character. Her role as a community leader in this village began 15 years ago when as a young mother she found herself in financial difficulties.

[Villagers/Loan Borrowers]

I was looking for cash flow, so I borrowed money from. We call a loan shark for 10,000 baht.

[Reporter/Interviewer]

But anyway, which is about $400 or something.

[Villagers/Loan Borrowers]

Yes, right. I have to repay my lender and. And they keep harassing to get money. So the thing I can do is just flee, just go to a mountain, hiding myself in a barn in the forest.

[Ed Butler]

You ran with your children to the mountains to escape the loan sharks?

[Villagers/Loan Borrowers]

I was in pregnancy and my husband, we ran from one province to another province and hide himself and somebody burns until I can settle down and get more money. So I get back to them and return money to them. And I was lucky. They have enough from me and they don't want anything from me anymore.

[Ed Butler]

And that's where J A's story becomes a little more complex and controversial. Getting back on her feet financially in the years that followed, she set out, she says, to help others in similar difficulties. She chooses the words carefully to describe the work she does now.

[Villagers/Loan Borrowers]

Since COVID Pandemic. So I help everyday people who doesn't have food, medicine, they want some work, seeds and helping people. Public service like helping people.

[Ed Butler]

Helping people for Jea means lending them money. Under Thai law, if you're not a formally registered financial body, that is technically against the law. Although the precise rules about what is and is not allowed are quite complex and not always totally clear. So when you help people, what do.

[Reporter/Interviewer]

You ask in return?

[Villagers/Loan Borrowers]

So when people come to me, they will tell me about how much money they want to borrow. If you borrow 10,000 Baht, you have to pay back 400 Baht for 30 days. And at the end of the month they will ask to borrow another amount of money and they pay back in every day as well.

[Reporter/Interviewer]

What happens if they don't pay you back?

[Villagers/Loan Borrowers]

Of course, there are many cases that they Cannot pay back in time. I will say something bad to them, I admit that. But anyway at the end they will say that they want some time.

[Ed Butler]

This is video posted online of Ja shouting at borrowers in default. Wearing her slightly incongruous trademark headband which is shaped like furry rabbits ears, she rages at scared villagers with the camera trained on her. Her booming voice and her larger than life personality have turned her into something of a TV and social media celebrity. In.

[Reporter/Interviewer]

You never use violence against people.

[Villagers/Loan Borrowers]

I never use violence against the physical but violence for word, of course I did. Sometimes that's the case that family borrow everything from me but they don't pay back. So I just asked them and say you come to meet me now, don't let me get out of the house and you know what will happen to you. Just come to me and pay the money, don't let me get out of the house.

[Reporter/Interviewer]

She's pointing her hand. She's been very demonstrative and having a good time describing this. Does that work?

[Villagers/Loan Borrowers]

Everybody knows that if I point out at someone and start shouting they will know that that is my last doll. I will be like angry and aggressive. Are you going to pay or not? And they would be afraid of that and try to find some money to return me. So it works for me.

[Ed Butler]

Chat shows in Thailand have invited her on to fulminate at how reckless and feckless her borrowers can sometimes be. She seems to enjoy the limelight. But all this publicity has come at a price for Ja. This is the sound of J A being read her rights as part of a police raid also caught on camera. Back in 2023 she was formally accused of being a loan shark. It's a label she strenuously denies. Unlike unscrupulous lenders who will sometimes use violence, she says she sets reasonable rates of interest, about 20% a month and she only lends manageable amounts. The legal case against her has eventually been dropped.

[Villagers/Loan Borrowers]

Hundreds of official law enforcement, government officials stormed into my house looking for the evidence to try to fight a shot against me. But at the end they cannot find any evidence against me. I don't want to be in this situation but I want to help people. They just come to us and ask me for money. So my husband and I will ride a motorcycle, maybe drive a car to give them supply. So I just want to help.

[Ed Butler]

The reality is people do need credit and as mentioned, most of those on low income can't get conventional cheaper loans from the banks. Here's the IMF's Corinne Delashat again, the.

[Corinne Delasha]

Fact that a lot of the debt is unsecured and held by low income households means that it's very hard to recover. And as you said, these are owed to cooperatives or loan shareholders sharks and they have very high interest rates and totally lack consumer protection.

[Reporter/Interviewer]

What are the rules governing that sector?

[Corinne Delasha]

This type of lending is illegal. And then there's been various crackdowns on that type of lending. I think the authorities are doing the right thing. They're trying to incorporate more informal borrowers into the formal lending system to leverage other data than just credit history, like looking at your history of paying utility bills, for example, to qualify you for bank loans. So they're trying to help people without formal credit history to get access to formal credit. I think where Thailand could do better is to expand the coverage of social protection. The households who borrow mostly don't have a choice. Thailand is a country where over half of the workforce is in the informal sector. So they have often precarious jobs, no job security, and the social protection coverage is insufficient to cover their consumption needs. So when there's a shock, particularly a shock as big as Covid, they have to borrow and then, you know, they just cannot make ends meet otherwise. But at the same time household tend to over borrow and the culture of repayment is not fully established. A lot of households tend to make only very minimum payments on the loans, so the debt keeps accumulating and that's mostly a lack of financial literacy. So having a social protection floor that's more uniform and protects those groups a bit better would help a lot in terms of preventing this borrowing, reacting to shocks, and it would be also in the long term, less costly to the government.

[Ed Butler]

Back in Ban Phu Yuan, a local vendor serves me a delicious bowl of spicy chicken soup. I ask her what she thinks of the local village moneylender, J A Natterin. She comes by often. She tells me the vendor doesn't take the loans herself, she says, but she thinks that Ja is respected and considered fair by most of those who do. Ja herself says that demonising moneylenders like her is just the government avoiding its own responsibilities to take care of working people. People for whom she says debt is not a choice.

[Villagers/Loan Borrowers]

What the government can do is that they open a center or institute that provide money for informal workers. Because what do they go? They go to me just knocking on my door at 2 o' clock in the morning because their children have to go to a hospital or to buy school supply. And this is why people gaining more and more debt because they don't know how to get money.

[Ed Butler]

Down the road. Ball doesn't know what the solution is to the consumer debt crisis in Thailand. He simply dreams one day of having enough money to buy a four wheeled vehicle of his own. That and a regular job to pay for it.

[Reporter/Interviewer]

Are most people in debt? Do you?

[Villagers/Loan Borrowers]

Everybody are here are being in debt.

[Reporter/Interviewer]

He's shouting out to his friends, are you in debt? Are you in debt? And they're all shouting, Yep, they're all shouting, yes.

[Villagers/Loan Borrowers]

Actually, they say, who's not? Who's not?

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