A country renowned for natural and historical attractions, the Southeast Asian nation of Thailand also boasts a growing fintech ecosystem.
The second-largest economy in the Association of Southeast Asian Nations (ASEAN) region after Indonesia, has a gross domestic product (GDP) per capita of just shy of $7,000 per person, making Thailand a high-middle-income economy.
With a population of over 70 million people, Thailand’s capital and largest city, Bangkok, is world-renowned as a popular destination for tourists.
Much of the success of Thailand’s ecosystem can be attributed to government-led initiatives and market demand.
Thailand’s National Economic and Social Development Plan 2023–2027 (NESCD) aims to transform Thailand into a circular economy (CE) and a low-carbon society. This plan outlines three main targets for economic progress by 2027:
Achieving a minimum of one per cent contribution of the CE to GDP growth
Reducing domestic material consumption by at least 25 per cent
Increasing material circularity indicators for specific products by at least 10 per cent
Consumer behaviours and other factors promoting fintech
Thailand’s digital transformation is being driven, in part, by fintechs. Similar to other regions across Asia, mobile payments are now preferred as a payment method over card payments by 70 per cent of Thai consumers.
QR codes have also become a popular payment method in Thailand. Looking beyond Thai borders, the Bank of Thailand has revealed a plan to introduce QR code cross-border payments with India by the third quarter of this year.
Over 94 per cent of Thai consumers have used digital systems to pay for services, with the most used method being digital wallets, according to Mastercard’s New Payments Index 2022.
Key developments for fintech in Thailand
Thailand’s fintech ecosystem boasted over $28billion in assets under management (AUM) in 2023. Although not quite as big as other neighbouring countries such as Singapore, Thailand’s fintech sector continues to grow.
In 2017, Kasikorn Bank (KBank) set up the Kasikorn Business-Technology Group (KBTG) to operate as the tech development and IT infrastructure wing of the KBank group.
The same year, ‘PromptPay’, a real-time proxy payment service developed by Thai banks and Vocalink, was launched. The payment service enables Thai users to send and receive payments into bank accounts or digital wallets linked to their national identification numbers, mobile phone numbers or email addresses.
In 2019, the Bank of Thailand launched a regulatory sandbox initiative. The central bank is also involved in the Inthanon Project, a joint initiative with the Hong Kong Monetary Authority in which it works alongside eight commercial banks to explore the potential of Distributed Ledger Technology (DLT) in developing a wholesale CBDC.
Supporting startups
Thailand is also investing significant resources into its wider startup ecosystem. In 2016, the Ministry of Digital Economy and Society (MDES) was established, as well as the National Startup Committee, which aims to generate ideas for improving the startup ecosystem.
In 2017, the Digital Economy Promotion Agency (DEPA) was created under MDES with a mandate to support startups. Various incubator and accelerator programmes and financing institutions, including venture capital, have also been introduced to support tech startups.
The National Innovation Agency (NIA) launched its own strategy in February 2024, in a move to support local startups. The agency wants to increase the number of innovation-based enterprises and transform Thailand into a top 30 leading innovation nation by 2030.
There are over 2,100 startups in Thailand, of which 700 are in the pre-seed funding stage and 1,400 are in the go-to-market and growth stage, according to NIA. In 2022, there were 268 fintech firms in Thailand. These figures mean that Thailand currently trails behind other ASEAN countries including Indonesia (785), Malaysia (549) and Singapore (1,350).
While fintech isn’t necessarily the largest tech component in the country, it does have significant impact.
Fintech firms accounted for only 17 per cent of Thai startups that received funding in 2017, but these received around 40 per cent of the total funding – making it the second highest sector behind e-commerce, EY revealed.
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