Thailand hopes to match the rapidly rising global standards in digital banking but Bank of Thailand’s governor notes that it will take more than just the efforts of the central bank.
Veerathai Santiprabhob said the central bank will look to launch electronic lending and other financial services this year through a collaboration with various parties. Though he did not disclose details, the BoT governor stressed that collaboration between government agencies is critical, according to a report.
It cannot be the central bank alone, he said.
Digital banking in Thailand is feeling the tailwinds, despite the lack of independent virtual lenders seen emerging in neighboring financial hubs. UOB was the latest reported entrant into the country with the launch last year of its first mobile-only bank, TMRW. Local lenders, too, are making digitalization inroads with one player reportedly reaping the success of applying gamification in its business.
Although Thailand has digital banking ambitions, Veerathai is cognizant of the gap between its market and other rival players in Asia. He highlighted data from non-financial sources, an electronic identification system and a suitable regulatory framework as three key pillars required to build virtual banks.
At this stage, Thailand might not have the ecosystem ready like in Singapore or Hong Kong, where the digital banking system is in better shape, he said.
When we talk about digital banking licenses, we want to have a new financial services provider that can serve the currently underserved, meaning that you have to be able to meet the needs of people on the street, people from far, far away, Veerathai said.
Whilst access to the unbanked market is undoubtedly an attractive proposition, Veerathai acknowledged the challenges required to evaluate borrowers’ creditworthiness due to insufficient data available.
This can come from when customers use mobile phones, the way they conduct their business using the digital footprint ecosystem, he added.