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TechTalk / Treasury & Capital Markets
Five groups seek to open digital banks in Thailand
Central bank will only award three licences by mid-2025 as applications close
Patricia Chiu 3 Oct 2024

The Bank of Thailand (BOT) has officially closed applications for virtual bank licences, with five groups having sent in applications. However, the central bank says it will still only grant three licences once it makes a decision in mid-2025. 

Somchai Lertlarpwasin, assistant governor of the financial institutions policy group at the BOT, says the application period closed on September 19. “It is expected that the list of successful applicants approved by the Minister of Finance to establish virtual banks will be announced by mid-2025,” he notes in a press statement.

However, despite receiving five qualified applications, Chayawadee Chai-anant, BOT assistant governor for corporate relations, tells local media it will still only hand out three licences in order to maintain stability in the domestic financial market, while also safeguarding depositors from risks associated with a new business venture such as a digital bank.

The BOT started accepting applications for virtual banking licences in March, following in the footsteps of Asean neighbours Malaysia, the Philippines, Singapore and Indonesia, as well as other Asian markets such as Hong Kong, mainland China, Taiwan, South Korea and Japan, to allow virtual banks, or banks with no physical bank networks. 

While the BOT did not announce who the actual five applicants are, based on their own announcements, the applicants include a mix of traditional banks looking to break into the digital space as well as joint ventures and partnerships between and among fintech companies, conglomerates and telecommunication firms. 

The applicants include: a collaboration between Siam Commercial Bank, and China-based WeChat as well as South Korea-based Kakao Bank; a partnership between Thai conglomerate Charoen Pokphand Group-backed Ascend Money and China-based Ant Group; a joint venture made up of Singapore-based Sea Group, the operator of e-commerce giant Shoppee, along with Bangkok Bank, Thailand Post, Sahapat Group, and VGI; a joint venture between Gulf Energy Development, telco giant Advanced Info Service and Krungthai Bank Plc; and Lightnet, a collaboration between fintech firm Lighthub Asset and Hong Kong-based digital banking pioneer WeLab.  

The BOT will now evaluate the applicants’ “qualifications, potential, and capabilities in operating a virtual bank”. After the BOT determines which among the five will receive licences, the successful applicants will have one year to prepare to start operations.