T&S Asset Management
Listen日本語

Thai rules capping payment terms to SME suppliers at 45 days take effect 2 November, with revenue-based fines

Published Data as of ThailandRegulationSME
Listen0:00

A one-minute summary read by an AI voice.

Key points

Implications for lenders

For lenders to Thai SMEs, receivables from covered large buyers are due within 45 days, or 30 days for agricultural goods, which can shorten working-capital needs and make repayment schedules easier to match to cash inflows. Invoice and supply-chain finance volumes against long buyer terms may fall, so pricing and limits may need review. Underwriting can track actual buyer payment days, since exceptions allowed on business grounds may leave some cycles longer.

Implications

ExecutivesLarge buyers need to review supplier terms before 2 November, since fines are set as a share of revenue rather than a fixed amount.
InvestorsWorking capital may shift from large retailers and manufacturers to their SME suppliers, which can affect buyers' cash conversion cycles and short-term borrowing.
OperatorsInvoice-finance and supply-chain finance products built on long buyer terms may see lower demand per invoice but faster, more predictable settlement.

Facts

The rule: a Trade Competition Commission (TCC) notification on fair credit terms for SMEs, issued under the Trade Competition Act 2017 and published in the Royal Gazette on 2 October, takes effect on 2 November 2026. Large buyers may not impose payment terms longer than 45 days 1 on SME sellers in trade, manufacturing and services, or longer than 30 days 2 for agricultural and simply processed agricultural products. Shorter agreed terms stay in place, and different terms are allowed where justified on business, marketing or economic grounds. Buyers must give at least 60 days notice 3 before changing contract or payment terms, and in disputes they must prove facts that only they know.

Scope and penalties: the notification covers buyers, including large wholesalers and retailers, with Thai-operations revenue of THB 500m or more 4 in the previous accounting year, with related businesses counted together. SME sellers are manufacturers with up to 200 employees and THB 500m annual revenue 5, and service, wholesale and retail firms with up to 100 employees and THB 300m annual revenue 6. Administrative fines can reach up to 10% of revenue in the year of the offence 7; conduct that also breaches the Act's prohibitions on abuse of dominance or anti-competitive agreements can carry criminal penalties, according to The Nation.

Expected effect: The Nation reports that payment cycles to SMEs could previously run 60 to 90 days 8. The president of the Thai SME Council estimates that the shorter terms would release about THB 250bn 9 of working capital, and up to THB 750bn 10 where the longest cycles shorten to the cap, helping more than three million SMEs 11. The council has not published its method.

Analysis

The caps themselves are not new. The TCC's 2022 guideline on SME credit terms, in force from 16 September 2022, already set 45 days 12 for trade, manufacturing and services and the same shorter cap for agricultural goods as the new notification, and longer terms were allowed if agreed in writing on reasonable grounds. According to The Nation, SMEs kept reporting non-compliance during more than four years of the earlier guidelines. What changes in November is the frame around the caps: a defined set of large buyers, a notice period for changing terms, a shifted burden of proof, and revenue-based fines spelled out in the notification.

For SMEs, faster payment by large buyers can partly substitute for bank credit, which has been shrinking. Bank lending to SMEs contracted, at −4.6% year on year in Q2 2026 13, extending a run of 16 consecutive quarters of decline 14, and the Bank of Thailand Governor cited an SME NPL ratio of 9.5% 15, vs about 2% for large corporates. Faster collection of receivables reduces how much short-term financing an SME supplier needs, at the cost of tighter cash management for the buyers.

Counterpoints and uncertainties

The exceptions for terms justified on business grounds may let buyers keep longer cycles, and SMEs may hesitate to complain against key customers. The working-capital estimates come from an SME advocacy body without a published method. Buyers facing tighter cash may respond by cutting order volumes, pushing prices down or moving purchases to non-SME suppliers. How strictly the TCC enforces the rules in the first months will decide the effect.

Key figures

  1. Maximum payment term to SME suppliers (trade, manufacturing, services): 45 days. Maximum credit term large buyers may impose on SME sellers in trade, manufacturing and services under the Trade Competition Commission notification effective 2 November 2026. Large buyers dealing with SME sellers in Thailand. Basis date: 2 Nov 2026. Source: The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  2. Maximum payment term to SME suppliers (agricultural products): 30 days. Maximum credit term for agricultural goods and simply processed agricultural products bought from SMEs under the notification effective 2 November 2026. Large buyers dealing with SME sellers in Thailand. Basis date: 2 Nov 2026. Source: The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  3. Advance notice before changing SME payment terms: at least 60 days. Minimum notice large buyers must give before changing contract conditions or payment terms with SME suppliers. Large buyers dealing with SME sellers in Thailand. Basis date: 2 Nov 2026. Source: The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  4. Revenue threshold for buyers covered by the SME credit-term rules: THB 500m or more. Thai-operations revenue in the preceding accounting year at or above which a buyer (with related businesses combined) is covered. Buyers in Thailand, including large wholesalers and retailers. Basis date: 2 Nov 2026. Source: The Nation: Thailand updates 30- and 45-day SME payment rules from Nov 2 (2026-10-06)
  5. SME supplier definition, manufacturing: up to 200 employees and THB 500m annual revenue. Manufacturing sellers counted as SMEs under the credit-term notification. SME sellers in Thailand. Basis date: 2 Nov 2026. Source: The Nation: Thailand updates 30- and 45-day SME payment rules from Nov 2 (2026-10-06)
  6. SME supplier definition, services, wholesale and retail: up to 100 employees and THB 300m annual revenue. Service, wholesale and retail sellers counted as SMEs under the credit-term notification. SME sellers in Thailand. Basis date: 2 Nov 2026. Source: The Nation: Thailand updates 30- and 45-day SME payment rules from Nov 2 (2026-10-06)
  7. Maximum administrative fine under the SME credit-term rules: up to 10% of revenue in the year of the offence. Administrative fine under Section 82 of the Trade Competition Act 2017 (THB 1m if the offence is in the buyer's first year of business). Covered buyers in Thailand. Basis date: 2 Nov 2026. Source: The Nation: Thailand updates 30- and 45-day SME payment rules from Nov 2 (2026-10-06)
  8. Payment cycles to SMEs before the new rules: 60 to 90 days
    Value = midpoint. Descriptive range from the press report, not a survey statistic.
    . Payment cycles to SME suppliers that could previously run this long, as described in The Nation's report on the new rules. SME suppliers in Thailand. Basis date: 24 Oct 2026. Source: The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  9. Working capital released for SMEs, Thai SME Council estimate (60 to 45 days): about THB 250bn
    Advocacy estimate; the method is not published.
    . Estimate by the Thai SME Council president of working capital released if payment terms shorten from 60 to 45 days; method not published. SME suppliers in Thailand. Basis date: 24 Oct 2026. Source: The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  10. Working capital released for SMEs, Thai SME Council estimate (90 to 45 days): up to THB 750bn
    Advocacy estimate; the method is not published.
    . Upper estimate by the Thai SME Council president if 90-day cycles shorten to 45 days; method not published. SME suppliers in Thailand. Basis date: 24 Oct 2026. Source: The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  11. SMEs expected to benefit, Thai SME Council: more than three million SMEs. Number of SMEs the Thai SME Council president said the measures would help. SMEs in Thailand. Basis date: 24 Oct 2026. Source: The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  12. Maximum SME credit term under the 2022 TCCT guideline (trade, manufacturing, services): 45 days
    Longer terms were allowed if agreed in writing with reasonable commercial grounds.
    . Credit term cap in the TCCT guideline on fair credit terms for SME sellers (No. 2), effective 16 September 2022. Business partners of SME sellers in Thailand. Basis date: 16 Sep 2022. Source: DFDL: Thailand legal update on credit term criteria for SMEs (TCCT guideline No. 2 of 2022)
  13. Bank SME loan growth, y/y: −4.6%
    Per BOT official.
    . Year-on-year change in bank lending to SMEs. SME lending, banks. Basis date: 30 Jun 2026. Source: The Nation: New bad debts rise as high costs and weak demand strain Thai firms (2026-08-19)
  14. Consecutive quarters of SME loan contraction: 16 consecutive quarters. Number of consecutive quarters with year-on-year decline in bank SME lending, to Q2 2026. SME lending, banks. Basis date: 30 Jun 2026. Source: The Nation: New bad debts rise as high costs and weak demand strain Thai firms (2026-08-19)
  15. SME NPL ratio cited by BOT Governor: 9.5% (vs about 2% for large corporates)
    The Governor did not state the period, lender coverage or definition (gross/net) behind the figure.
    . Non-performing loan ratio of SME borrowers cited by the BOT Governor on 8 October 2026. SME loans. Basis date: 8 Oct 2026. Source: The Nation: BOT Pledges Credit Overhaul to Open Bank Loans to Thai SMEs (2026-10-08)

Sources

  1. The Nation: Thailand enforces stricter credit terms to release THB250bn working capital for SMEs (2026-10-24)
  2. The Nation: Thailand updates 30- and 45-day SME payment rules from Nov 2 (2026-10-06)
  3. DFDL: Thailand legal update on credit term criteria for SMEs (TCCT guideline No. 2 of 2022)
  4. Thai Enquirer: News summary, 26 October 2026 (SME credit-term rules from 2 November)
Weekly email

SEA Lending Brief

A weekly summary of lending, credit and regulation across Southeast Asia.

We will email you a link to confirm. Unsubscribe at any time. Privacy policy

Reports are for information only and are not investment advice.

A Japanese version of this article is available: 日本語版

More on Thailand

22 Oct 2026 · CreditSix Thai banks' Q3 NPL ratios span 2.88% to 3.4% as lenders flag stretched households21 Oct 2026 · CreditThailand adds THB 30bn of soft loans for flood-hit SMEs as state lenders pause repayments20 Oct 2026 · RegulationThailand drafts BNPL rules: all-in charges capped at 15% a year (effective rate)

Thailand overview: key indicators and all articles →