During the past few years, the Fintech sector in Thailand has grown significantly. The country is now home to at least 96 Fintech startups.
Thailand’s Fintech ecosystem includes companies and businesses operating in the digital payments space, blockchain or distributed ledger tech (DLT). There are several Fintechs offering financial comparison tools, Insurtech services, retail investment platforms, peer to peer (P2P) lending, personal finance solutions, business tools, crowdfunding services, financial education portals, remittance payment services, and financial infrastructure providers.
As reported recently, the Southeast Asia region (which includes Thailand) has emerged as a Fintech hotspot with a CAGR of 55% in equity funding. Digital challenger banks in Southeast Asia have adopted several different business models in order to establish operations in the Fintech and banking sector. They’ve experienced a threefold growth (over 300% growth) during the past five years, according to a new report from the Singapore Fintech Association (SFA).
Digital banking competition in Southeast Asian countries like Thailand should intensify as there’s been a boom in Fintech Investments, according to a recent report.
In addition to steady growth in digital banking services, there’s also been strong growth reported in the region’s nascent blockchain and crypto-assets sector. Thailand’s Securities and Exchange Commission (SEC) has issued licenses to at least 13 crypto-related companies which now offer digital currency exchanges and also serve as brokers and dealers. Thailand and several other Asian countries now have one of the world’s fastest-growing digital asset markets.
As first reported by Fintech News, local Fintechs like AmiLabs have been leveraging blockchain or DLT to digitize the securities issuance process. AmiLabs has also been digitizing commodities and currencies. Some other notable Fintechs now based in Thailand include MoneyTable, an HR and financial benefits management platform for firms and their workers; and Masii, an online financial comparison platform.
Within the ASEAN region, the Fintech ecosystem in Thailand continues to remain quite small when compared with other markets like Singapore and Indonesia.
Last year, Fintechs in Thailand accounted for only 8% of all of the ASEAN region’s financial technology companies, according to United Overseas Bank’s (UOB) report that was prepared with assistance from PricewaterhouseCoopers (PwC) Singapore and the Singapore Fintech Association.
Thailand-based Fintechs are also behind other markets when it comes to securing funding. Thai Fintech companies only secured around 1.5% of all the capital that was allocated to ASEAN Fintechs this past year.
Although Thailand’s Fintech sector is still in its early stages, the nation’s authorities have been launching initiatives to support the growth of modern financial services which have become essential due to the COVID-19 outbreak. As reported in August 2020, the Bank of Thailand had signed a Fintech-focused MoU with the UK government, which is aimed at supporting sustainable economic growth.
As covered in July 2020, there’s still a $300 billion funding gap for SMEs based in Thailand and other Southeast Asian nations and it’s critical because they account for 42% of the region’s total GDP.