Thailand became an upper-middle income economy in 2011. Over the last four decades, Thailand has made remarkable progress in social and economic development, moving from a low-income country to an upper-income country in less than a generation. As such, Thailand has been one of the widely cited development success stories, with sustained strong growth and impressive poverty reduction, particularly in the 1980s.
Long-term economic aspirations are laid out in Thailand’s recent 20-year strategic plan for attaining developed country status through broad reforms. The reforms address economic stability, human capital, equal economic opportunities, environmental sustainability, competitiveness, and effective government bureaucracies. Progress on reforms has already been made. These include the implementation of multi-year large public infrastructure projects, setting up of a State Enterprise Policy Committee to improve state-owned enterprise governance, transfer of supervisory oversight of specialized financial institutions to the Bank of Thailand, approval of progressive inheritance and property taxes and the launch of the National Savings Fund, a retirement safety net for informal workers. Going forward, the sustained pace and quality of reforms as well as sound implementation will be crucial for translating the reform effort into the desired economic outcomes. Continued reforms in additional areas such as education and competition as well as public infrastructure management and government bureaucracies will be particularly important to take Thailand from middle to high income. The World Bank is supportive of the reform agenda.
Mondato Summit Asia 2016 Thailand
On September 20 and 21, Mondato Summit Asia 2016: The Transitioning of Financial Services in Emerging Asia which focused on strategies for navigating the current transition from established mobile financial services to more dynamic ‘digital finance and commerce’ (DFC) is held in Bangkok. It is one of the most anticipated Fintech events in Asia in second half of 2016. Particularly, the event focused on the priority areas for establishing end-user trust, business considerations for managing the digital transformation, potential inroads to the SME segment, and value chain implications of accelerating smartphone adoption.
The conference touched upon the diverse use cases seen across the region – ranging from fundamental P2P transfers to savings, loans and credit to products that leverage social media, e-Commerce and smartphone penetration. Thought leaders and industry innovators came together to discuss key challenges and opportunities in the development, innovation, deployment, adoption, and regulation of digital financial services in the ASEAN region.
Fintech in Thailand
Finnomena and Piggipo are the two latest and popular fintech startups in 2016 to secure major VC investment deals from reputable global investors including 500 Startups and Golden Gate Venture. The two startups both successfully raised large funding rounds from Dave McClure-led early-stage venture fund and seed accelerator 500 Startups, as a part of the investment firm’s fintech-focused program in Thailand.
Finnomena is acted as a financial investment guru. Initially, the Finnomena app was launched for users that are planning to make smart retirement investments. However, the startup began to garner mainstream attraction when university students started to use the Finnomena application to make smart investments on a wide range of assets including mutual funds, real estate properties, and even stocks of public companies. With all the gurus share their knowledge and sharing of experiences through online channels and the media, Finnomena builds a knowledge base from the ground up to the full professional level for investors. Finnomena not only hopes to introduce an interesting investment to investors but also wants the investors who have come to the knowledge to unlock the “potential” of other investors.
Piggipo is a popular finance management application that allows users to manage credit cards and budget in one unified platform. Since its launch in 2014, Piggipo has been considered one of the top mobile applications in all categories and have been awarded in various competitions and events for its smart mobile-based application that autonomously evaluates user’s spending habits and creates advance payment strategies. You can see the total cost of all credit cards within the app’s home page, make the decision to use your card easily and efficiently. Through credit card interest calculations, Piggipo helps to maximize the pay plan. It is easily analyze the expenses you use too. Enables you to easily save your credit card expenses. It shows the cut-off date of each card.
National FinTech Sandbox (NFS)
On 10 September 2016, National FinTech Sandbox (NFS)- National Fintech Testing and Development Center is launched to drive the Finance industry in Thailand. The sandbox will enable developers working on lending, payment and money-transfer services and products to experiment for up to a year. The regulatory sandbox is a safe place where business can test innovative products, services, business models and delivery mechanisms. “Participating in regulatory sandbox experiments allows for speedier approval for the solution than otherwise, if during the experimental period of less than one year, they can prove that their solutions secure and give benefits to consumers and Thai financial system”, Bangkok Post quoted Vireka Suntapuntu, Senior Director of the Financial Institution Applications Department, Thailand.
She said that the regulatory sandbox will facilitate information sharing between the central bank, banks and other fintech operators, while ensuring regulatory compliance. Also, the Bank of Thailand (BOT) would ease some regulations if experiments show them to be obstructing the competitiveness of fintech companies and banks. Moreover, if the products and services from the sandbox can facilitate convenience, safety and protection for consumers, the BOT might consider adjusting the KYC (know your customer) rules to facilitate their use. Importantly, all participating banks and fintech companies must inform their customers that they are in the regulatory-sandbox process. In addition, they will be required to pay compensation to customers in the event of damage resulting from using their products and services, according to Suntapuntu.