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Business Times
9 hours ago
- Business
- Business Times
Top Thai billionaires-backed groups win digital bank permits
[BANGKOK] Three groups led by Charoen Pokmhand Group, Gulf Development and SCB X have clinched Thailand's new virtual bank licences to boost competition in the nation's banking industry, according to the central bank. ACM Holding, which is part of CP Group, and Advanced Info Service, a Gulf Development's mobile phone affiliate, secured the permits, Bank of Thailand said on Thursday (Jun 19). SCB X, which formed a consortium that includes China's WeBank and South Korea's KakaoBank, also obtained the virtual bank licence. 'We have high hopes that the new licences will increase competition in the banking industry with new innovation and technology,' deputy governor Roong Mallikamas told a press briefing. The announcement came amid a fresh political turmoil in the country that puts the current government on the brink of collapse. The nation is opening its banking industry to more competition that will allow greater access to loans for under-served consumers, following similar moves across Asia. Still, the new virtual banking operators will confront a landscape where traditional lenders are saddled with rising bad loans and weakening credit demand on the back of a soft economy. The timing of these permits is 'tricky and throws up a number of challenges,' said Sarah Jane Mahmud, a senior bank analyst at Bloomberg Intelligence. 'Singapore digital banks have yet to break even, three years after going live,' she said. 'With hefty investment in digital platforms and marketing, Thai digital banks could face a longer wait to generate profit.' Singapore handed out digital banking permits in 2020, followed by the Philippines and Malaysia. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up Low-income individuals and small business will also have a greater access to new credit by the new operators of virtual banks, said Roong. The Chearavanont family, which controls CP Group, is one of Asia's richest clans, according to the Bloomberg billionaires Index report. It has businesses spanning from foods and retail to telecommunication and properties. It forayed into digital payment and financial services through fintech unit Ascend Money, with more than 50 million customers in Thailand and six other South-east Asian countries. Gulf Development, controlled by billionaire Sarath Ratanavadi, was created earlier this year by combining his empire – ranging from power to seaports, tollways and telecommunication – under one roof with the goal to accelerate his expansion in digital infrastructure such as data centres. Sarath is Thailand's second-richest person with a net worth of USUS$11 billion. Joining Sarath's group in the bid are Krung Thai Bank and PTT Oil and Retail Business, according to the central bank's statement. BLOOMBERG
Korea Herald
11 hours ago
- Business
- Korea Herald
Kakao Bank secures 'virtual bank' license in Thailand
South Korea's internet-only lender Kakao Bank said Thursday it has received approval from the Thai government to operate a "virtual bank," marking the first reentry of a Korean bank into the Thai market in 25 years. The Thai Ministry of Finance recently selected a consortium formed by Kakao Bank and Thailand's leading financial group SCBX as one of three operators of the country's upcoming virtual banking system. "This license is a crucial step in exploring new markets and a valuable opportunity to showcase the excellence of Korea's digital finance technology," Kakao Bank Chief Executive Officer (CEO) Yoon Ho-young said. Through the virtual bank project, Kakao Bank aims to serve as a bridgehead for Korean banks and companies looking to enter the Thai market, he said. The Kakao Bank consortium received high marks for its expertise in building digital banking infrastructure, advanced technological capabilities, and localization strategies. Thailand's virtual banking initiative is designed to offer financial services entirely through digital platforms without physical branches -- similar to South Korea's internet-only banks. Full-scale operations are expected to begin in the second half of 2026, following a one-year preparation period.
Korea Herald
13 hours ago
- Business
- Korea Herald
Kakao Bank wins approval for Thailand's first virtual bank
Korean lender sets sights on second-half 2026 launch under SCBX-led joint venture Kakao Bank, South Korea's leading internet-only lender, has secured final approval to establish Thailand's first digital bank, marking the official launch of its joint venture with Thai financial giant SCBX to roll out services next year. The Bank of Thailand on Thursday announced the winners of its long-awaited virtual banking licenses, selecting three applicants from five contenders. The SCBX-led consortium — whose members include Kakao Bank and Tencent-backed Chinese digital lender WeBank — was among those granted a license. The other winners were ACM Holding Company and a consortium led by state-run Krung Thai Bank. The licenses were issued following a review by Thailand's Ministry of Finance, based on central bank recommendations. Authorities assessed business models, digital capabilities and each group's potential to boost financial inclusion, particularly for underserved consumers and small businesses. Thailand's central bank said the digital lenders are expected to enhance customer experience, increase efficiency, and drive healthy competition through innovation and better pricing. Regulators also weighed the optimal number of new banks to foster healthy competition while maintaining financial system stability. The approved candidates are required to establish a corporate entity in the third quarter and commence operations within one year, setting the stage for operations to begin in the second half of 2026. The milestone comes two years after Kakao Bank, a subsidiary of Korea's IT giant Kakao, signed a memorandum of understanding with SCBX in June 2023 to collaborate on developing Thailand's first digital bank. SCBX is the holding company of major Thai lender Siam Commercial Bank. This marks Kakao Bank's second overseas venture after launching Superbank in Indonesia through a joint venture with Grab. It remains the only Korean internet-only bank with international operations. The move also signals a meaningful return of Korean banking to Thailand, nearly three decades after Korean lenders exited the market during the 1998 Asian financial crisis. 'Drawing on its experience in shaping Korea's digital banking landscape, Kakao Bank will play a leading role in building the new Thai digital bank, overseeing the development of its technology infrastructure and service design,' a company official told The Korea Herald. Once established, Kakao Bank will become the second-largest shareholder in the new online lender. In response to the approval, Kakao Bank CEO Yun Ho-young called the license "a stepping stone into a new market and a valuable opportunity to showcase the strength of Korea's digital finance technology," adding that the firm aims to serve as a bridgehead for Korean banks and companies seeking entry into the Thai market.
Bloomberg
13 hours ago
- Business
- Bloomberg
Top Thai Billionaires-Backed Groups Win Digital Bank Permits
Three groups led by Charoen Pokphand Group, Gulf Development Pcl and SCB X Pcl have clinched Thailand's new virtual bank licenses to boost competition in the nation's banking industry, according to the central bank. ACM Holding Co., which is part of CP Group, and Advanced Info Service Pcl, a Gulf Development's mobile phone affiliate, secured the permits, Bank of Thailand said on Thursday. SCB X, which formed a consortium that includes China's WeBank Co. Ltd. and South Korea's KakaoBank Corp, also obtained the virtual bank license.
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Korea Herald
07-05-2025
- Business
- Korea Herald
[Hello Thailand] 'Thailand ready to join Asia's financial hubs'
Deputy finance minister touts tax breaks, digital banks in push for global investors With its geographical connectivity and sound regulatory infrastructure, Thailand is well-positioned to emerge as the financial hub of Southeast Asia, according to Deputy Minister of Finance Julapun Amornvivat. 'We believe Thailand can serve as a strong financial hub in Southeast Asia,' Amornvivat said in a recent interview with The Korea Herald. He visited Seoul late last month to attend the Ignite Thailand-Korea Business Forum, co-hosted by Herald Media Group, the Royal Thai Embassy in Korea and the Industrial Estate Authority of Thailand. 'With our central location in Southeast Asia and proximity to neighboring countries such as Laos, Myanmar and Cambodia, we have a strategic edge over others.' While Hong Kong and Singapore currently serve as Southeast Asia's key financial hubs, Julapun emphasized that Thailand can complement their roles and contribute to the broader region. 'There are already financial centers in Singapore and Hong Kong, but Southeast Asia still has room for another hub,' he said. 'We are committed to strong regulatory practices, transparency and sound governance.' As part of this effort, Thailand plans to establish the Office of Supervisory and Promotion of Financial Hub Business — a one-stop regulatory body designed to streamline licensing and oversight processes. 'This is a long-term vision — not something for just a year or two, but a plan spanning the next decade or more,' he said. 'In the initial phase, we'll focus only on international financial services, not domestic activities. A phased approach is essential.' For South Korean financial firms, Thailand has long been considered a challenging market, with high entry barriers in place since the late 1990s, when many withdrew during the Asian financial crisis. But that may be changing, Amornvivat said. 'Our banking sector has been protected for the past 50 years. Now, we are opening up select areas,' he noted. One potential area of change is the approval of digital banking licenses. Kakao Bank, a South Korean internet lender, has joined a consortium led by SCBX — a major Thai bank — to bid for a virtual banking license. If successful, the SCBX consortium is expected to launch official operations by mid-2026. When asked about the approval timeline, Amornvivat replied, 'It is in process,' without elaborating further. However, he reaffirmed Thailand's openness to foreign capital. 'The floor is open. There will be opportunities for all types of firms to enter Thailand,' he said. 'I hope that not only Korean firms but also global players will take advantage of our tax incentives and establish a strong presence here.' Among other growth drivers, Amornvivat highlighted the Land Bridge project and the establishment of integrated entertainment complexes. The Land Bridge initiative aims to connect the Gulf of Thailand and the Andaman Sea through a 90-kilometer highway and railway, providing an alternative trade route to the heavily congested Strait of Malacca. 'We've received significant interest in the Land Bridge project from countries like China and across the Middle East. We haven't heard from Korea yet — but we're waiting,' he said. Although the project is expected to cost 1 trillion baht ($30 billion), Amornvivat said he sees no financing challenges. 'A high-speed railway linking China and the Pacific Ocean is also in the works, further strengthening our position as a strategic logistics hub,' he added. Thailand is also exploring the legalization of gambling and has designated Bangkok, Chonburi, Chiang Mai and Phuket as candidate sites for its first integrated entertainment complexes. These would feature casinos, theme parks, concert halls and even a Formula 1-grade street circuit. 'Since the announcement, we've seen strong interest from investors eager to work with the government,' Amornvivat said. 'We're confident these man-made tourist destinations will attract substantial investment and inject new energy into the tourism sector,' he added. 'These entertainment complexes are where the dreams of the Thai people can come true.'
