CHIANG RAI – The Department of Business Development (Ministry of Commerce) and the Bank for Agriculture and Agricultural Cooperatives (BAAC) are moving forward with a “trees as capital” approach. The goal is to help farmers use standing trees as business collateral, improve access to credit, and build future income through carbon capture credits.
So far, farmers in 30 provinces have registered 239,921 trees as collateral across 320 contracts, with a total guaranteed value of more than 188 million baht.
On Feb 23, 2026, Mr. Poonpong Naiyanapakorn, Director-General of the Department of Business Development, assigned Mr. Jitrakorn Wongkhetkorn (Deputy Director-General) to visit Nan.
He joined BAAC to run a training session on using standing trees as business collateral at the Biowithi Community Enterprise in Nam Kian Subdistrict, Phu Phiang District, Nan Province.
The session focused on helping people understand how trees grown on their own land can support a loan application. It also introduced how carbon credits may create another income stream. This model helps farmers and SMEs reach funding without cutting down trees. BAAC is the first bank to accept standing trees as loan collateral under Thailand’s business collateral law.
Progress is expanding across provinces
The Deputy Director-General said the department has worked with BAAC and provincial commerce offices to build awareness in more than 13 provinces, including Chiang Rai, and the outreach will continue.
Current results already show strong demand, with registrations now covering 30 provinces. In other words, the trees stay where they are, but they can still help create working capital.
Mr. Somporn Bowornprapapong, Director of the Credit Procedure Division at BAAC, said the bank wants to help farmers access funding in a way that fits local life and local resources. Standing trees are not only natural assets, but they can also become economic assets when valued properly and registered under the law.
Because of that, farmers don’t need to sell land or cut trees to raise cash. Instead, they can use trees as collateral, get credit, and invest in their work or grow a small business.
How BAAC values trees for collateral
BAAC also sends specialist teams to advise communities on tree valuation. The bank applies clear basic requirements, including:
- The tree must be more than 1-year-old
- The trunk circumference is measured at 130 cm above the ground
That data then supports a fair and transparent valuation process.
BAAC added that, over time, communities with good management can also connect standing trees to the carbon credit market. This can become extra income for households while supporting Thailand’s green economy goals.
The Biowithi Community Enterprise in Nam Kian has 753 members across five villages. The group promotes economic trees and herbs such as bai mee, kaffir lime, turmeric, and butterfly pea. Members process these into hair and body care products under the brand “Chewar”, which helps keep income circulating inside the community.
Overall, this field visit wasn’t only about legal or financial details. It also helped the community see trees as business assets that can support loans today and open doors to carbon credit income later.
