Thailand’s finance companies are putting loan quality ahead of aggressive growth, making 2026 lending targets harder to reach.

Finance firms are expected to fall short of their loan growth ambitions this year as they adopt more cautious lending strategies, according to UOB Kay Hian (UOBKH).

According to Asian Banking and Finance, the sector’s combined loan portfolios grew 5% year-on-year, but lenders are becoming increasingly selective amid concerns over economic conditions and borrower repayment capacity.

UOBKH analyst Thanawat Thanchadakorn said finance companies were likely to miss their 2026 targets because management teams were prioritising asset quality and taking a more conservative approach to new lending.

Muangthai Capital has reduced its loan growth target to 8–10%, from its previous range of 10–15%. Its chief executive said the company needed to remain cautious as risks to the economy increased.

UOBKH expects prudent lending policies to help finance companies keep asset quality under control.

The sector reported combined net profit of THB7.06bn ($214.5mn) in the second quarter, an increase of 16% from a year earlier. Credit costs also dropped substantially, falling 46 basis points year-on-year, although they increased by 5 basis points from the first quarter.

Muangthai Capital has reported weaker repayment conditions among some borrowers, with higher oil prices adding to financial pressure. Management is also concerned about subdued demand for loans while seeking to protect asset quality.

Srisawad Corporation has taken a more optimistic stance, retaining its 2026 loan growth target of 10–15%. The company plans to continue expanding its core title-loan businesses, including vehicle and land-backed lending.

UOBKH remains cautious about Tidlor Holdings, with management expressing uncertainty over its ability to maintain strong asset quality. However, it expects lending to pick up during the second half as economic and business activity improves, with motorcycle and car loans likely to drive growth.

Krungthai Card’s management was more upbeat, forecasting continued growth in net profit.