Govt offers help with HP debts

Consumers are getting government help with debts incurred in hire-purchase contracts for cars or motorcycles.

The move comes after the government set its sights on bringing down household debt for eight specific groups, as it makes tackling debt issues one of its primary missions this year.

One target is resolving automobile and motorcycle debts, such as by setting a rate limit for follow-up fees so clients can avoid paying unnecessary fees.

In a move which took effect on Sept 14 last year, the government told debt collectors they cannot collect fees for overdue installment payments of less than 1,000 baht, said Rachada Dhnadirek, deputy government spokeswoman.

“The maximum debt collection fee allowed per overdue payment is 50 baht and the total cannot exceed 100 baht in cases of more than one overdue installment payment,” Ms Rachada said.

The maximum fee allowed in the event the collector has to travel is 400 baht.

The Office of the Consumer Protection Board (OCPB) is also reviewing other measures in relation to car and motorcycle HP contracts.

“Hire purchase interest rates will be tweaked to make them correspond to actual risk, as terms and conditions for seizing hire-purchase vehicles will be changed to improve fairness for consumers,” she said.

The government also aims to find an organisation to regulate hire-purchase and similar businesses.

The body will also ensure protection for taxi and taxi motorcycle drivers when it comes to taxi hire-purchase contracts.

“Currently, the OCPB still doesn’t have the authority to regulate taxi and taxi motorcycle HP contracts, which compromises protection for these drivers even though they too are considered consumers when it comes to hire purchase,” she said.