Thailand’s Fintech sector has called for the government to introduce regulations and support homegrown industry startups in the face of an increasing trend of external operators moving into the Thai market. The Bank of Thailand, the country’s central bank, does not enforce any regulations for…
Thailand’s Fintech sector has called for the government to introduce regulations and support homegrown industry startups in the face of an increasing trend of external operators moving into the Thai market.
The Bank of Thailand, the country’s central bank, does not enforce any regulations for cross-border trade in the financial services sector, leaving external payment platforms to gain a presence in the country. An example sees Thailand’s fourth largest bank by assets, Kasikornbank, partner Chinese fintech firm IBS for baht-yuan cross-country settlements. An alternative to the traditional SWIFT cross-border settlement system, the partnership, formed in December 2016, will enable remittance in Thailand-China corridor with near-instant transfer at cheaper costs.
A more notable move of a payments giant moving into Thailand saw Chinese conglomerate Alibaba announce a partnership with Ascend Money, the Fintech subsidiary of the CP Group which runs over 9,000 7-Eleven outlets in Thailand, the country’s biggest retail network. These partnerships will prove harmful for the local Fintech scene in Thailand, according to The Thai FinTech Association chairman Korn Chatikavanij, as reported by the Bangkok Post.
Speaking at an industry seminar yesterday, he stated:
The alliance between the two giants poses critical challenges to Thai Fintech companies.
The Fintech association’s chairman urged banks and companies to partner with local Fintech startups to help improve their standing in competition with international payment platforms. The fear is that foreign companies could monopolize the Thai market with their technological and financial might, leaving little room for innovation and development of the Fintech sector locally in Thailand.
The official also pushed for the government to impose a corporate income tax on the likes of Facebook and Google, tech giants that already have a stronghold of Thailand’s digital marketing industry.
Calling the government to make use of the ‘Trade Competition Act’, Korn said it was “time for the government to create a level playing field between local and foreign players and prevent monopolies from taking hold” in Thailand.
In a previous instance of regulations toward a Fintech innovation, The Bank of Thailand has, despite suspending operations the country’s then-only bitcoin exchange in mid-2013, relaxed its aggressive stance toward the cryptocurrency.
Images from Shutterstock.
Last modified: May 21, 2020 10:04 AM UTC