Which Is Better in Thailand: Share-Backed Finance or Securities-Backed Lending?
If you’ve been keeping an eye on financial trends in Thailand lately, you’ve probably noticed a growing buzz around share-backed finance and securities-backed lending. These two funding methods are becoming hot topics among investors, entrepreneurs, and even everyday individuals looking to unlock the value of their investments without selling them.
But here’s the big question: Which option actually works better for you in Thailand — share-backed finance or securities-backed lending?
The Big Picture: Unlocking Your Investment’s Value Without Selling
Before we dive deep into comparing Share backed finance Thailand and Securities backed lending Thailand, let’s get one thing clear: both approaches are designed to let you access liquidity without selling your assets.
Think of it like this — you’ve worked hard to build an investment portfolio. You have shares, stocks, or securities that have appreciated in value. Selling them could give you quick cash, but it might mean losing potential future gains or paying capital gains tax.
Instead, these lending solutions let you borrow against the value of your investments, using them as collateral, while you still retain ownership.
What Is Share-Backed Finance in Thailand?
Share-backed finance is a type of loan where you pledge your shares (often in a public or private company) as collateral to secure funding.
Here’s how it usually works in Thailand:
- You own shares in a listed or private company.
- You approach a lender (could be a bank, private lender, or specialized finance company).
- The lender evaluates your shares based on their current market value and liquidity.
- You receive a loan amount — often up to 50-80% of the share value.
- You continue to own the shares, but they are pledged until you repay the loan.
Example:
Let’s say you hold shares in a Thai energy company worth 5 million THB. Instead of selling them, you use them as collateral and get a loan of around 3.5 million THB. You now have liquidity for business expansion, personal investment, or emergency expenses — all without losing your ownership stake.
What Is Securities-Backed Lending in Thailand?
Securities-backed lending works similarly to share-backed finance, but the term “securities” is broader. It includes not only shares but also bonds, mutual funds, ETFs, and other marketable instruments.
In Securities backed lending Thailand, lenders assess the overall market value of your securities portfolio. This often allows for greater flexibility since you can pledge a mix of assets rather than just company shares.
How It Works:
- You have a portfolio of stocks, bonds, or funds.
- A lender evaluates the portfolio’s value and risk profile.
- They offer you a credit line or lump-sum loan based on the portfolio’s worth.
- You can often draw funds when needed, much like a revolving credit facility.
Key Differences Between Share-Backed Finance and Securities-Backed Lending
While they sound similar, there are clear differences that can affect which is better for you in Thailand.
| Feature | Share-Backed Finance | Securities-Backed Lending |
| Collateral | Only company shares (public or private) | Broad range of securities (shares, bonds, ETFs, etc.) |
| Flexibility | Limited to the value of pledged shares | More diversified collateral base |
| Loan-to-Value Ratio (LTV) | Often higher for stable, blue-chip shares | May vary based on asset mix |
| Liquidity Risk | Can be high if share prices drop | Diversification can reduce risk |
| Use Cases | Business owners, major shareholders | Investors with diverse portfolios |
Advantages of Share-Backed Finance in Thailand
- Higher LTV for Stable Shares – If your shares are in a strong, stable company, you might get a better loan-to-value ratio.
- Simple Collateral Structure – Only one type of asset is pledged, making the process straightforward.
- Retain Ownership – You don’t lose voting rights or dividends (unless specified by lender terms).
Advantages of Securities-Backed Lending in Thailand
- Portfolio Diversification – You can pledge a mix of assets, which can reduce the lender’s risk.
- Flexible Borrowing – Often structured as a revolving credit facility, giving you more control over when and how you use the funds.
- Lower Volatility Impact – If one asset drops in value, others in the portfolio may balance it out.
Which Is More Popular in Thailand Right Now?
In Thailand’s current financial climate, Securities backed lending Thailand has been gaining more traction among high-net-worth individuals and investors who have diverse portfolios. The flexibility of pledging multiple types of assets appeals to those who want to minimize risk.
That said, Share backed finance Thailand remains highly attractive to business owners and major shareholders of Thai companies, especially those seeking quick capital for expansion without selling their stake.
When Share-Backed Finance Might Be the Better Choice
You might lean toward share-backed finance if:
- You’re a major shareholder in a profitable company.
- Your shares are relatively stable and have low volatility.
- You prefer a simple loan structure without dealing with multiple asset types.
- You want a potentially higher LTV for a single asset type.
When Securities-Backed Lending Might Be the Better Choice
This could be the right fit if:
- You have a diversified investment portfolio.
- You want flexible borrowing terms and the option to draw funds as needed.
- You’re looking to reduce risk by pledging multiple assets.
- You want to avoid the impact of a single asset’s price fluctuations.
Risk Factors You Need to Know
Regardless of which option you choose, both come with risks:
- Market Fluctuations – If the value of your shares or securities drops, the lender might issue a margin call, requiring you to add more collateral or repay part of the loan.
- Interest Costs – While these loans can be cheaper than unsecured loans, interest rates still apply.
- Liquidity Risk – In extreme market downturns, you could be forced to sell assets at unfavorable prices.
How to Choose the Right Option in Thailand
Here’s a simple framework:
- Assess Your Assets – Do you mainly own shares in one company, or do you have a diversified portfolio?
- Define Your Goal – Are you funding a short-term project, long-term investment, or emergency expense?
- Evaluate Risk Tolerance – Are you okay with higher volatility from single-asset pledges, or do you want a diversified safety net?
- Compare Lender Terms – Different banks and private lenders in Thailand offer varied LTV ratios, interest rates, and repayment terms.
The Thailand Market Outlook for 2025 and Beyond
Thailand’s investment and lending markets are evolving quickly. With digital finance platforms making it easier to value and pledge assets, both share-backed finance and securities-backed lending are likely to grow.
Government regulations are also adapting to encourage alternative financing methods, which could make these options even more competitive in the coming years.
Final Thoughts
The choice between Share backed finance Thailand and Securities backed lending Thailand ultimately depends on your financial situation, asset composition, and risk appetite.
- Go for Share-Backed Finance if you own substantial shares in a stable company and want a straightforward loan arrangement.
- Opt for Securities-Backed Lending if you have a mixed portfolio and want more flexibility with reduced asset-specific risk.
Both options can be powerful tools for unlocking liquidity without losing ownership — as long as you understand the risks and choose a trusted lender.
In the end, the best choice is the one that aligns with your goals and protects your long-term wealth.
