KASIKORN Research Centre projects that the debt-to-GDP ratio may slide to 84.0% by the end of 2026, down from 86.8% in 2025, but this does not signify a resolution to the debt problem, as the slow pace of debt growth partly reflects constraints on new borrowing rather than an improvement in financial standing, Naewna newspaper said today (Oct. 12).
Sustainable household debt deleveraging will ultimately require a recovery in household income and debt-servicing capacity.
The household debt-to-GDP ratio stood at 85.2% in the second quarter of 2026, with total debt rising by only 0.6% year-on-year. However, trends varied across loan categories, reflecting disparities in purchasing power and borrowing capacity among household groups, and underscoring a “K-shaped” growth pattern in debt types.
Debt repayment burdens remain a significant constraint on household financial health. An analysis of the National Statistical Office’s 2025 Socio-Economic Survey (SES) data by Kasikorn Research Centre revealed that households earning no more than 15,000 baht per month had an average Debt Service Ratio (DSR) of 40.1%, compared to an average DSR of 26.3% for all indebted households.
Many households continue to face cash flow constraints; approximately 23.8% of indebted households have monetary income insufficient to cover expenses (negative cash margin), a problem that is particularly acute among low-income groups.
With expenses arising from unexpected events, such as flooding, vulnerability could extend to middle-income households with a sensitivity analysis by this research centre indicating that a 10% increase in expenses would cause the cash margins of approximately 1.2 million additional households to turn negative, with the majority falling within the 15,000–50,000 baht monthly income bracket.
CAPTION:
A graphic image on finance. Credit – Naewna
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