Debt management with sustainable using ESG concept

Abstract

Over the past year, Thailand has faced various situations, including the epidemic, the impact of war, inflation, and the rapid adjustment of policy interest rates by central banks around the world. Which Thailand itself has to increase the policy interest rate in 2023, resulting in a high cost of living due to inflation and increased costs from adjusting the policy interest rate, causing the economy to slow down. According to the survey on the status of Thai household debt in 2024, it was found that the Household debt have 99.7% of people, and another O.3% do not have debts. The most common debt is credit card debt, followed by vehicle debt, personal debt for consumption, housing debt, business debt and education debt. There are many companies in Thailand that are engaged in debt management business and are ready to provide advice, including banks, medium-sized and small-sized credit companies. Whether it is banks, SMEs or asset management companies that are involved in the process of managing public debt, sustainable public debt management must have a common mindset from both financial institutions and debtors. Debt management with sustainable development approach and ESG concept has 3 main components as main components in debt management, namely financial institutions (banks, finance, microfinance) providing fair services from the lending process to the debt negotiation process. For the debtors themselves, they must be disciplined in spending and have a systematic financial plan. Finally, the ESG concept, which refers to the environment, society, and governance (Environment, Social, Governance: ESG), requires both financial service institutions and debtors to use the ESG concept in order to jointly solve debt problems sustainably.