Bangkok has all the ingredients for a world-class Fintech Hub
Bangkok has all the ingredients for a world-class Fintech Hub
As the entire planet becomes connected with technology, financial technology or Fintech has taken a key role in revolutionizing the financial industry. This unavoidable transformation is an opportunity which should be seized with both hands to propel Bangkok to the forefront as a Fintech Hub with a key global role. Three critical ingredients give Bangkok an advantage over other Asian locations:
- Resilient financial infrastructure and readiness of Thais to adopt Fintech services
- Location of Bangkok as a regional hub with Chiang Mai and Phuket as key tourist cities
- Diversity of distinctive lifestyles supporting both work and leisure time.
A good payment infrastructure offering zero or extremely cheap transaction fees has resulted in many Thais making good use of mobile payments, eCommerce, and many other services, at much higher rates than most of the rest of the world. Measured by the proportion of Internet users in the capital markets, the Stock Exchange of Thailand has the highest trading values in ASEAN. Thailand also has infrastructure for connecting domestic and international financial institutions. There are also a large number of listed companies that are well respected for sustainable management and are ranked in Dow Jones Sustainability Indices (DJSI). Also, regulators have launched projects to create a new financial landscape supporting the growth of Fintech services in the near future such as Virtual Banking, Open Banking, Central Bank Digital Currency (CBDC), Initial Coin Offering, and Securities Token Offering (STO). These new Fintech programs will make financial systems more productive in providing services to the broad general public, and particularly better meeting the needs of underserved customers while generating employment and enhancing employees’ capabilities. Bangkok has the opportunity to attract personnel skilled in fintech at the international level, with the charm of the city and its culture. People are encouraged to travel from every nation on Earth to enjoy Thailand’s foodie scene, nightlife, shopping, and domestic tourism to provincial cities, with low expenses to balance incomes. Bangkok is also a favored location for traveling to other countries in Asia. Thailand is justly famous as a welcoming nation for visitors of all nations, enabling international collaborations with any nation, as a buffer state removed from the conflict and geopolitical risk.
What must we do to make the dream of Bangkok as a Fintech Hub into reality?
government and the private sector must cooperate to build an ecosystem that is conducive to fintech companies from overseas setting up offices and businesses. This can start with an Online One-stop Service to register the establishment of a company that is quick and supports the English language. This starts with opening an online bank account for a judicial person, with greater convenience and fewer restrictions on employing foreign labor. There should be services of advice about accounting, the law, and permits from the pertinent government agencies. Bangkok should have a designated zone, which could be a group of buildings or a single road, to be a symbolic Fintech Hub or Fintech Street. This area could be used to attract Fintech companies and be a Sandbox Zone for trials of new financial services. Universities should cooperate with financial institutions to design curricula devoted to establishing Fintech entities, particularly in the fields of finance, accounting, business management, computer engineering, and computer science. In this, every sector should help provide capital support, providing capital, tax breaks, advice, and other assistance for Fintech companies which is equally fair to both small and large companies, and both Thai and foreign companies. The critical issue is communicating this program to the target groups in each country.
What will the country gain from being a Fintech Hub?
If we are successful in attracting international Fintech companies to set up offices in Thailand, the direct benefits will be influxes of foreign investment and increased employment. In the medium term, we will be a source of leading Fintech expertise who can mentor the younger generation to become world-class Fintech Talent. Thais working abroad for leading companies will have the opportunity to return home and develop their own country. In the long term, new Fintech services from this pool of people and companies will help the country overcome key Pain Points such as household debt, loan sharking, wealth inequalities, and the lack of provisions for retirement. The benefits of being a Fintech Hub will have a crucial role in financial innovation and sustainable development of the country.
Chonladet Khemarattana, President, Thai Fintech Association
