The Cabinet has approved a budget of 7 billion baht to support the Bank for Agriculture and Agricultural Cooperatives (BAAC) in implementing a project to reduce loan interest rates for smallholder farmers by 3%, starting from August 1, 2018, to July 31, 2019.

          Mr. Putthipong Punnakanta, spokesperson for the Prime Minister's Office, revealed that the Cabinet meeting approved the Ministry of Finance's proposal to allocate 7.02 billion baht to reimburse BAAC for its project to reduce loan interest rates for smallholder farmers by 3%. This program is aimed at farmers who are customers of the bank with loan amounts not exceeding 300,000 baht, for a duration of one year, starting from August 1, 2018, to July 31, 2019. The government will compensate the interest on loans at a rate of 2.50% per year, while BAAC will bear an additional 0.50% per year.

          “In this regard, the Ministry of Finance has requested additional budget approval to enable BAAC to carry out the project to reduce loan interest rates for smallholder farmers, in accordance with the Cabinet's resolution on July 31,” Mr. Putthipong stated.

          However, the total budget for the 3% loan interest reduction project for smallholder farmers amounts to 16.3 billion baht, utilizing a central budget of over 2.3 billion baht for the fiscal year 2018 and over 13 billion baht for the fiscal year 2019.

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