New Banking Fees May Turn Thailand into a Cashless Society
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According to Veerathai Santiprabhob, Bank of Thailand governor, the current bank fee structure is distorted. He noted that paper-based transactions are cheap compared to actual costs, and banks are subsidizing these costs with fees on electronic transactions. In other words, a check fee may only be Bt15, but the actual cost is far higher. Currently, customers can withdraw money from ATMs, but banks incur huge costs for managing cash at ATMs.
A new project is helping to reduce cash usage in the country through the introduction of more point-of-sale throughout Thailand. There are currently less than 100,000 points of sale, which is much lower than the 2 million recommended by the Bank of Thailand.
To maintain retail customers, banks will be expected to reach out to merchants to create their own points of sales. Smaller merchants will also be required to have mobile point-of-sale to support small customers.
Under the project, companies who are registered with the Commerce Ministry will also be prohibited from denying e-payments.
The creation of a central system that will oversee cross bank transactions through the Internet, ATM cards and debit cards will help move Thailand to a cashless society. Adoption of the Any ID e-payment model will further help the country make this transition.
Questions & Answers
Q.What is the primary reason for changing the bank fee structure in Thailand?
What is the primary reason for changing the bank fee structure in Thailand?
The current fee structure is distorted, with paper-based transactions costing banks more than customers are charged. Banks are subsidising these higher costs by applying fees to electronic transactions, which needs to change to reflect actual banking expenses.
Q.How many points of sale does the Bank of Thailand recommend for the country?
How many points of sale does the Bank of Thailand recommend for the country?
The Bank of Thailand recommends having 2 million points of sale across the country. Currently, there are less than 100,000, which is significantly lower than the recommended number for reducing cash usage.
Q.What will banks need to do to keep their retail customers as part of this initiative?
What will banks need to do to keep their retail customers as part of this initiative?
Banks will be expected to engage with merchants to help them establish their own points of sale. Smaller merchants will also need to adopt mobile point-of-sale systems to serve their customers effectively.
Q.Will registered companies be able to refuse e-payments under the new project?
Will registered companies be able to refuse e-payments under the new project?
No, companies registered with the Commerce Ministry will be prohibited from denying e-payments. This measure is part of the project aimed at reducing cash usage and transitioning Thailand towards a cashless society.
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