Businesses in Thailand will soon be able to make cross border payments to Singapore, Myanmar, and Cambodia and the facility is expected to go online somewhere in the second or third quarter of 2020.

Currently, members of Asean often find it difficult to carry out international transactions due to the unavailability of a digital payment platforms that process multiple currency payments within a short period of time.

As a remedy to the problem, Thailand has decided to leverage the QR code technology and offer a seamless cross border payment option. QR code technology enables contactless, fast and secure payments with the use of mobile apps to merchants as well as consumers.

The recent developments can be attributed to the collaboration between central banks, fintech startups, and financial institutions from the Asean region.

Siritida Panomwon Na Ayudhya told the media, “Regional interoperability of standardised QR code payments between Thailand and these nations has continued to make strides.”

Last year, Thailand also signed a memorandum of understanding (MoU) with the central bank of Cambodia to develop a similar cross border payment platform that leverages QR code technology. The platform, which is now online, facilitates cross border payments in local currencies.

Many banks in Thailand have also independently developed digital payment services that facilitate cross border payments.

In 2019, Thanachart Bank partnered with a Lao bank to develop digital payment services in the neighbouring countries. During the same period, Siam Commercial Bank and Krungthai Bank developed digital payments in Cambodia and Singapore respectively.

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According to Pimolpa Suntichok, Deutsche Bank’s newly appointed chief country officer for Thailand, the bank wants to attract domestic corporations that are willing to expand in foreign markets or invest overseas.

Pimolpa Suntichok told the media that, “Increasingly we are seeing more European clients looking to set up supply chains in Thailand, particularly in the automotive industry, and trade finance is benefiting from this. We are also seeing Thai clients with offshore operations wanting more local day-to-day support to improve the efficiency of working capital.”

She added, “If you look at the top 10 conglomerates here, they are very large and going outside to expand revenue bases, get more recurring revenue and increase diversity in revenue bases. Our strategy is to expand more among local corporations, as Thai corporates are strong and are acquiring businesses outside of Thailand.”

According to reports, around 70 percent of Deutsche Bank’s clients in Thailand are foreign multinationals.
Reportedly, Deutsche Bank’s European clients are also interested in investing in development projects in Thailand such as high-speed rail projects.

Recently, Deutsche Bank also came under major scrutiny as it was alleged that the bank hired more than 100 under-qualified relatives of China’s political elite to expand its business in the country.

Earlier this month, it was reported that the bank is looking to cut around 18, 000 jobs globally with half of them in its home market in Germany.

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Siam Commercial Bank is Thailand’s largest bank with King Maha Vajiralongkorn as its biggest shareholder. Southeast Asian lenders have started to collaborate with technology firms in order to firm up their financial services to consumers using the technology.  

Last year, the lender increased its corporate venture capital fund by $50 million through its fintech investment arm Digital Ventures. Siam Commercial Bank in its official press release said that it is focusing more on direct investments rather than fund-of-fund investments to bolster its digital transformation strategy. 

Up to 80 percent of the $50 million investment will be directly invested in startups globally.  Siam Commercial Bank CEO Arak Sutivong said that the lender is anticipating returns on investment up to 30 percent over the next five years.  

The lender will be the most recent to join Go-Jek’s ongoing Series F round. Previously, Go-Jek had mentioned that it plans to invest the proceeds to speed up its market expansion in Southeast Asia. 

Go-Jek has raised more than $1 billion reaching a $10-billion valuation from investors including Provident Capital, Google, JD.com and Tencent in the first close of  Series F round. Mitsubishi is also an investor of Go-Jek and participated in the first round. GO-Jek President Andre Soelistyo said that these partnerships will allow the startup to have better reach and create value in the region. 

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