What is the state of Thailand and Open banking 2023?

The financial sector in Thailand has been rapidly evolving in recent years, with the advent of new technologies and regulatory changes driving increased competition and innovation. Open banking has emerged as a key area of focus for financial institutions in Thailand, with many seeking to leverage this technology to provide better services to their customers.

One of the primary drivers of the growth of open banking in Thailand has been the government's Digital Thailand initiative, which aims to promote the adoption of digital technologies across the economy.

As part of this initiative, the government has implemented a range of regulatory reforms designed to encourage the growth of open banking, including the establishment of a legal framework for electronic transactions and the promotion of data sharing among financial institutions.

In addition to regulatory reforms, there has also been a significant increase in investment in fintech startups in Thailand. Many of these startups are focused on developing innovative solutions in areas such as payments, lending, and wealth management, and are leveraging open banking technology to create new business models and services.

Several of the major banks in Thailand have also embraced open banking, with many investing heavily in technology and partnerships to enable them to provide better services to their customers. For example, Kasikornbank has established a dedicated fintech subsidiary, Beacon Venture Capital, which invests in startups and works with them to develop innovative solutions using open banking technology.

Another example of a bank in Thailand that has embraced open banking is Siam Commercial Bank (SCB). SCB has developed its own open banking platform, called SCB Connect, which enables third-party providers to access customer data and services in a secure and regulated way. SCB has also established partnerships with a range of fintech companies to offer innovative solutions to its customers, including a robo-advisor and a peer-to-peer lending platform.

Despite the rapid growth of open banking in Thailand, there are still challenges that must be overcome. One of the key challenges is the need to establish trust and security in the data-sharing process. Financial institutions must be able to ensure that customer data is protected and used in a responsible and ethical way, which requires strong data protection policies and robust authentication and authorisation protocols.

Another challenge is the need to address the technological and infrastructural barriers to open banking adoption. Many financial institutions in Thailand still rely on legacy systems, which can make it difficult to implement open banking technology. In addition, there is a need to establish common standards and protocols for data sharing, to ensure that third-party providers are able to access data in a consistent and secure way.

Overall, the state of finance in Thailand is rapidly evolving, with open banking emerging as a key area of focus for financial institutions and regulators alike. While there are challenges that must be overcome, the growth of open banking is expected to drive increased competition and innovation in the financial sector, and ultimately lead to better services and outcomes for customers.

Through my research I've summarised the do's and don'ts in Open banking in Thailand

Regulations:

• Thailand has established a legal framework for electronic transactions, which includes provisions for data protection and security.

• The Bank of Thailand has issued guidelines for data sharing among financial institutions, which require third-party providers to be licensed and subject to regulatory oversight.

• The government has established a National Digital ID program, which aims to provide a secure and standardized system for customer identification across the financial sector.

Dos:

• Financial institutions should establish strong data protection policies and protocols, and ensure that customer data is used in a responsible and ethical way.

• Financial institutions should work closely with third-party providers to establish common standards and protocols for data sharing, to ensure that data is shared in a consistent and secure way.

• Financial institutions should invest in technology and partnerships to enable them to provide innovative services and solutions to their customers.

Don'ts:

• Financial institutions should not share customer data in an unregulated or insecure way.

• Financial institutions should not neglect the need to establish trust and security in the data-sharing process.

• Financial institutions should not rely solely on legacy systems but should invest in modern technology to enable them to adopt open banking solutions.

PromptPay: The Catalyst for Open Banking in Thailand

PromptPay has been the catalyst for open banking in Thailand, driving innovation and competition in the financial sector and transforming the way that customers interact with their banks. This mobile payments platform has enabled the rapid adoption of digital payments in Thailand, providing a common standard for customer identification and data sharing, and creating new opportunities for financial institutions and fintech companies to collaborate and innovate.

PromptPay has been successful in large part because it has addressed a key pain point for customers in Thailand: the high cost and inconvenience of making traditional bank transfers. Prior to the introduction of PromptPay, many customers in Thailand relied on cash or checks to make payments, as bank transfers were seen as slow, expensive, and cumbersome. This created a barrier to the adoption of digital payments and inhibited the growth of the financial sector.

PromptPay has changed this dynamic by providing a fast, convenient, and low-cost way to make digital payments. Customers can transfer money between bank accounts in real-time using only their mobile phone number or national ID card, without having to visit a bank or pay high fees. This has made digital payments accessible to a much wider range of customers, including those who were previously excluded from the financial system.

At the same time, PromptPay has established a common standard for customer identification and data sharing across the financial sector, which has enabled financial institutions and fintech companies to work more closely together and offer innovative services and solutions. This has created a new market for financial services that can be accessed through open banking, enabling financial institutions to offer better products and services to their customers and driving growth in the financial sector.

One of the key benefits of open banking is that it enables financial institutions to share customer data with third-party providers in a secure and regulated way. This allows fintech companies to develop innovative solutions that can be integrated with existing banking systems and processes, providing customers with a seamless and integrated experience. PromptPay has played a key role in facilitating this data sharing, establishing a common standard for customer identification and data sharing that can be accessed by all financial institutions and fintech companies.

The regulatory environment in Thailand has also been supportive of the growth of open banking, with the government implementing a range of measures to promote the adoption of digital technologies across the economy. This has included the establishment of a legal framework for electronic transactions and the promotion of data sharing among financial institutions. These regulatory reforms have provided a supportive environment for the growth of open banking and have encouraged financial institutions to invest in technology and partnerships to enable them to provide better services to their customers.

Despite the success of PromptPay, there are still challenges that must be addressed if open banking is to reach its full potential in Thailand. One of the key challenges is the need to establish trust and security in the data-sharing process. Financial institutions must be able to ensure that customer data is protected and used in a responsible and ethical way, which requires strong data protection policies and robust authentication and authorization protocols.

Another challenge is the need to address the technological and infrastructural barriers to open banking adoption. Many financial institutions in Thailand still rely on legacy systems, which can make it difficult to implement open banking technology. In addition, there is a need to establish common standards and protocols for data sharing, to ensure that third-party providers are able to access data in a consistent and secure way.

Overall, PromptPay has been the catalyst for open banking in Thailand, driving innovation and competition in the financial sector and transforming the way that customers interact with their banks. While there are challenges that must be addressed, the growth of open banking is expected to drive increased competition and innovation in the financial sector, and ultimately lead to better services and outcomes for customers. As the financial

How does a fintech startup enable Thailand's PromptPay APIs?

A fintech company would need to integrate with the PromptPay API, which is provided by the Bank of Thailand. The PromptPay API enables third-party providers to initiate and receive payments using the PromptPay platform, and can be accessed through a RESTful web service.

To get started with integrating with the PromptPay API, a fintech company would first need to register as a PromptPay user and obtain an API key from the Bank of Thailand. This API key is used to authenticate API requests and ensure that they are authorized to access the PromptPay platform.

Once the fintech company has obtained an API key, they can start integrating with the PromptPay API by implementing the relevant endpoints in their own application. These endpoints include methods for initiating payments, querying payment status, and receiving notifications when payments are received.

To initiate a payment, the fintech company would need to provide the necessary payment details, such as the recipient's mobile phone number or national ID card number, the payment amount, and any other relevant information. The PromptPay API would then validate the payment details and initiate the payment, sending a notification to the recipient's mobile phone when the payment is received.

To query payment status, the fintech company would need to provide the relevant payment reference number and other details, and the PromptPay API would return the status of the payment, including whether it has been successfully processed or not.

To receive notifications when payments are received, the fintech company would need to implement a webhook to receive callbacks from the PromptPay API. This would enable them to update their own application and provide real-time feedback to their customers.

Overall, integrating with the PromptPay API enables fintech companies to offer seamless and secure payments to their customers, leveraging the power of the PromptPay platform to provide a fast and convenient way to transfer money. By leveraging the PromptPay API, fintech companies can improve their customer experience, drive growth, and differentiate themselves from competitors in the market.

What kind of documentation do you require to get registered as a fintech that wants to implement a PromptPay API in Thailand?

To get registered as a fintech that wants to implement a PromptPay API in Thailand, you will typically need to provide the following documentation:

1. Business registration documents: You will need to provide documents that prove your business is registered in Thailand. This may include a copy of your business registration certificate or commercial registration certificate.
   

2. Financial statements: You may be required to provide financial statements, such as your balance sheet and income statement, to demonstrate that your business is financially stable and capable of meeting its obligations.
   

3. Anti-Money Laundering (AML) and Know-Your-Customer (KYC) documentation: You will need to provide documentation that demonstrates your compliance with AML and KYC regulations. This may include information about your customer due diligence procedures and your policies for identifying and preventing money laundering and terrorist financing.
   

4. Technical documentation: You may be required to provide technical documentation, such as your API specifications and documentation, to demonstrate your technical capabilities and ensure that your integration with the PromptPay API is secure and compliant.
   

5. Business plan: You may be asked to provide a business plan that outlines your goals and objectives for implementing the PromptPay API, as well as your plans for ensuring the security and reliability of your integration.
   

6. Other regulatory requirements: You may need to comply with other regulatory requirements, such as data protection and privacy regulations, depending on the nature of your business and the services you provide.

It is important to note that the specific documentation requirements may vary depending on the regulatory authority or organization you are applying to. It is recommended that you consult with the Bank of Thailand or other relevant authorities to determine the specific requirements for registering as a fintech that wants to implement a PromptPay API in Thailand.

Don't forget everything must be in original copies and with 'blue ink' and your company seal.

Although the 'Tech is there', the speed in which to get 'approval' is relatively slow.

The time it takes to get registered as an API developer using PromptPay services in Thailand can vary depending on a number of factors, including the completeness and accuracy of your application, the complexity of your business model, and the current workload of the Bank of Thailand and other relevant authorities.

In general, the registration process for the PromptPay API typically involves submitting an application, providing the necessary documentation and undergoing a review process by the Bank of Thailand. This review process may include assessments of your technical capabilities, compliance with AML and KYC regulations, and other relevant factors.

The registration process may take several weeks or even months to complete, depending on the complexity of your application and the current workload of the Bank of Thailand. It is important to note that the registration process may be delayed if additional documentation or information is required, or if there are any issues or concerns with your application.

To expedite the registration process, it is important to ensure that your application is complete, accurate, and compliant with all relevant regulations and requirements. This may involve working with a legal or regulatory expert to ensure that your application meets all relevant standards and regulations.