Companies like Ngern Tid Lor have recognized the needs of low-income people are every bit as important as high-wage earners in building the Thai economy.
The late King Bhumibol Adulyadej focused his interests and time on enabling all his subjects with the means to practice self-sufficiency. From agriculture to automation, the unemployment rate in Thailand has always been one of the lowest in the industrialized world. Self-sufficiency is seen in Thailand as the right of the people.
But companies like Ngern Tid Lor are the ones who help the people maintain self-sufficiency in the new digital age.
Opportunities Provided by Microcredit
Microcredit is a concept that was established by economist Muhammad Yunus. The concept was put to the test in Bangladesh in 1976. A small amount of money was lent to women to start a business that would be sustainable as an enterprise. Each woman borrowed US $27. They worked as a collective to make bamboo stools. None of the individual women would have qualified for a bank loan under usual banking standards. But they were applying for a small loan as a collective was a novel way for low-income people to gain a foothold into becoming self-sufficient.
The initial success of the concept made microcredit a viable lifeline to the under-privileged and low-income people in many developing countries. Today, there are many versions of microcredit loans that are adjusted according to the needs of the borrower and the state of the local economy.
Microcredit in the Digital Age
With the ability to transfer money to different accounts cheaply and efficiently, microcredit has continued to thrive in the digital age. Companies like Ngern Tid Lor have focused on microfinance in their business models and concentrate on using digital technology to extend the reach of their services. With the abilities that digital applications provide, they can offer a greater amount of services to a greater number of customers.
The flexibility provided by these digital applications also enables these types of lenders to offer bonuses for developing good financial habits. A customer who always pays on time would accrue bonus points, lower interest rates, or special prizes that they could use to expand their business or to enjoy for personal use.
Microcredit also is ideally suited to the digital age due to the worldwide popularity of smartphones. Smartphone users can always be in contact with their microcredit accounts and lenders.
Benefits to Economic Development
Governments have also recognized the benefits of microcredit to economic development. Millions of people have become economically productive members of society through microfinance. The more their numbers increase, the greater the benefit to the local economy.
Governments recognize that if enough of their citizens are contributing to the economy, the small amount of each individual contribution doesn’t matter because of the overall number of contributors.
Microcredit is a financial service that began as a small local phenomenon and has benefitted both the people and the country by the leap into digital technology.