The National Economic and Social Development Council has released data on household debt that shows a worrying rise in borrowing among Generation Z and recent graduates.
The council said household debt stood at 16.44 trillion baht, or 86.7% of GDP, at the end of the fourth quarter. At the same time, bad debt and non-performing loans (NPLs) remained elevated at 1.31 trillion baht for three consecutive quarters.
Meanwhile, the National Credit Bureau reported an increase in borrowing among Gen Z consumers, with credit card debt rising by 13.5% and personal loans by 11.5%. Members of Generation Z, born between 1997 and 2012, or those under 25 years of age, appear to be spending beyond their means.
These findings are consistent with Visa's Gen Z Decoded 2025 study, which found that 58% of Thai Gen Z consumers follow recommendations from influencers on YouTube, TikTok and Facebook.
In addition, the growth of e-commerce and "buy now, pay later" (BNPL) services has compounded the problem by making spending easier and blurring the line between "want" and "need".
Young consumers can make purchasing decisions within seconds before fully considering the consequences.
If this spending trend continues, the problem will extend beyond personal finances and could eventually affect the country's economic stability.
A closer look at the spending patterns of this generation reveals three worrying signs. First, many young people are taking on debt at the beginning of their careers. If they are unable to repay it, bad debt could prevent them from achieving traditional milestones such as homeownership.
Second, much of Gen Z debt is linked to lifestyle spending, including fashion, travel and shopping, rather than investments that generate income or long-term returns.
Finally, those caught up in the fear of missing out (FOMO) often feel pressured to spend beyond their means to maintain a certain image. As a result, many struggle to make ends meet, have little or no savings and lack an emergency fund, leaving them vulnerable to financial hardship.
It is therefore essential that government agencies, schools and financial institutions provide this generation with the financial literacy needed to avoid falling into a cycle of excessive spending. Australia, where financial literacy is incorporated into school education, offers a useful example.
Needless to say, the issue requires urgent attention. At the personal level, young consumers must learn restraint and avoid making purchases through BNPL platforms until they are certain they genuinely need the items. At the same time, they should develop healthy financial habits, including regular saving.
More importantly, policymakers and other stakeholders must do more to address the problem. Financial planning should be incorporated into the school curriculum, while students should learn how to navigate consumerism and social pressures that encourage overspending.
In addition, the state and financial institutions should strengthen oversight of digital lending. BNPL providers and similar platforms should be regulated.
At the same time, authorities should work with influencers and digital platforms to promote responsible spending and saving habits among young people.
