Unveiling the Future of Payments
This month, the Bank of Thailand is set to launch an exciting pilot project for a retail central bank digital currency (CBDC). According to local media, three payment providers are gearing up to join the fray in this regulatory sandbox, promising to bring us one step closer to cashless convenience!
Partners in Innovation
Joining forces for this digital adventure are Bank of Ayudhya (a.k.a. Krungsri), Siam Commercial Bank, and the ambitious Singapore-based payments service provider 2C2P. Each partner will roll out unique apps for selected participants, featuring wallet capabilities and a handy QR code scanner—because who doesn’t want more ways to spend their money digitally?
Participants and Expectations
The pilot will involve a maximum of 10,000 users running through August. Krungsri is planning to incorporate up to 2,000 staff members for the testing phase along with approximately 100 merchants located right around their headquarters. And if that’s not exciting enough, they’re extending the project to their Ploenchit branch to widen the testing pool!
Strategizing for Success
As Sam Tanskul, managing director of Krungsri Innovate, notes, the bank is looking to carve out a unique space in the CBDC landscape. They’re working to distinguish their retail CBDC from the already popular PromptPay service. After all, with so many cashless options, standing out is key!
A Learning Journey
Although the initial announcement of this pilot came back in August, it’s important to point out that the Bank of Thailand views this initiative as a “pilot to learn” rather than a definitive launch of the CBDC. There are no immediate plans yet for a full-scale rollout, as the bank seeks to explore and evaluate the digital terrain.
Historical Context
The journey into the CBDC realm has been ongoing since 2018, when the Bank of Thailand first began developing a wholesale CBDC. Since then, they have dabbled in notable projects, including the Bank for International Settlements’ mBridge cross-border payments initiative and Project Inthanon-Lion Rock with the Hong Kong Monetary Authority. It’s clear they’re not just dipping a toe into the digital waters; they’re making serious waves!
Tax Incentives and Future Prospects
In a forward-thinking move, Thailand recently waived corporate income tax and value-added tax for companies issuing investment tokens. A governmental spokesperson revealed that while the country might face a $1 billion revenue loss due to this move, they anticipate generating a whopping $3.7 billion in two years. Talk about a gamble!
