Thailand Payments Market Analysis: User Preferences and Growth Data

The Thai payments market has grown rapidly in recent years, driven by the expansion of e-commerce, the push for digital banking policies, and the high level of technological acceptance among the younger population. The following analyses and provides key insights in two dimensions: user preferences and growth data:

I. User preference analysis

1. Cash remains significant but continues to decline

   • The share of cash transactions is about 50% in 2023 (Bank of Thailand data), but the share is rapidly declining in retail scenarios, especially in urban areas.
   • Small transactions (e.g., street vendors) are still predominantly cash-based, due to fees and infrastructure constraints.

2. Explosive growth of e-wallets

   • Mainstream platforms: TrueMoney (market share 35%), Rabbit Line Pay (tied to Line's social ecosystem), GrabPay (cross-border integration advantage).
   • user profile: 20-35 year olds account for over 60%, preferring swipe-to-pay and seamless offline and online experiences (e.g. 7-11 convenience store top-ups).

3. The contradictory coexistence of bank cards and QR code payments

   • Credit/debit card penetration is ~40% (Visa/Mastercard dominated), but mainly used in medium to high spending scenarios.
   • Local instant payment system PromptPay (based on mobile phone number/ID card transfers) has an average of 30 million transactions per day (2023), and the government is pushing for it to become a national infrastructure.

4. The Rise of Buy Now Pay Later (BNPL)

   • Platforms such as Atome and Kredivo are growing at a significant rate in the e-commerce scenario, with user growth of 200% in 2022-2023 (Bangkok Post data), attracting mainly the younger segment with a monthly income of less than 15,000 baht.

II. Key data on market growth

1. Overall size and growth rate

   • Digital Payments Market Reaches $18 Billion by 2023, CAGR 14% (2019-2023) (Statista)
   • The share of non-cash transactions is expected to exceed 60% by 2025.

2. Segment performance
   | Payment Methods | 2021 Shares | 2023 Shares | CAGR |
   |—————-|———-|———-|———|
   |Electronic Wallet |18% |32% |33% |
   |Bank Card |30% |28% |- |
   |Bank Transfer |25% |22% |- |

Note: Negative growth in some traditional channels

3. driving force::
   Policy: The Bank of Thailand's National e-Payment Masterplan promotes paperlessness;
   Merchant side: e-commerce platforms such as Lazada/Shopee make e-payment mandatory;
   User Side: Smartphone penetration reaches 92% (Newzoo).

III. Challenges and opportunities

–sore point
Fragmentation of cross-border payments (Alipay is commonly used by tourists but not by locals);
The Agent Banking network in rural areas still needs to be expanded;

–future trends
Social Commerce (Social Commerce) integrated payments (TikTok Shop case);
Open Banking API acceleration (e.g. SCB Bank's co-op ecosystem).

It is advisable to keep an eye on the progress of PromptPay's interconnectivity with other ASEAN countries (Jazzy Southeast Asia's version of SWIFT), as well as the potential deregulation of cryptocurrency payments.

IV. Competitive Landscape and Key Players Analysis

1. Local giants vs.

• TrueMoney (Ant Group Investment): Thailand's largest e-wallet covering offline retail (7-11, Lotus's), utility bill payments and cross-border payments (Laos, Myanmar). exceeds 40 million users in 2023, accounting for 57% of Thailand's population.
• PromptPay (Government-led): Real-time money transfer via mobile phone number/ID card with average daily transaction volume of over 5 billion baht. Interbank settlement system lowers access threshold for small and medium-sized merchants.
• International players limited but differentiated::
  • Alipay/WeChat Pay mainly serves Chinese tourists (accounting for 60% of travel payments), but localisation has been slow;
  • GrabPay, relying on the SuperApp ecosystem, has a 15% share in the taxi + takeaway scenario.

2. Increased cooperation between banking systems and fintechs

• Siam Commercial Bank (SCB) launches "SCB Easy" App with PromptPay+ e-wallet integration; Kasikornbank offers BNPL services through "KPlus". Kasikornbank offers BNPL services through "KPlus". Traditional banks are responding to the challenge of purely digital banking with an open API strategy.

V. Differences in Payment Behaviour in Segmented Scenarios

VI. Policy and regulatory developments

1. Central Bank Digital Currency Pilot: The Bank of Thailand plans to test retail CBDCs in 2024, potentially impacting the existing e-wallet landscape;
2. Data localisation requirements: Foreign payment organisations are required to store Thai user data within the country (similar to Vietnam regulations);
3. anti-trust legislation: Market share investigations against headliners such as TrueMoney may trigger rate controls.

VII. Future growth opportunities

1. Rural Market Sinking--Correspondent banking network extended to township areas (currently covering only 60%):

   • The TrueMoney Agent model allows small shops to offer cash top-up and transfer services;
   • KBank's "KShop" agency has exceeded 50,000 points.

2. Cross-border integration::

   • ASEAN QR standard rollout (Thailand, Malaysia and India are interconnected) to reduce currency exchange friction;
   • PromptPay's interoperability trial with Singapore's PayNow will land at the end of 2024.

3.Embedded Finance::

• TikTok Shop's embedded e-wallet leads to impulse spending conversions;
  - Line Man (in-app rider tips transferred directly to Rabbit Line Pay).

VIII. Risk warning

1.Over-reliance on head platforms:: TrueMoney will cause market shocks if it is split by regulation ;)
2.Persistent cash inertia:: 351 TP3T consumers outside Bangkok still refuse non-cash payments (Nielsen research).
3.Geopolitical implications:: US-China technology decoupling may limit terminal device support for Alipay/WeChat Pay.

It is recommended that new entrants adopt the strategy of "local partners + deep cultivation of vertical scenarios", such as the development of a universal payment system for membership points in conjunction with the Central Group of Department Stores, so as to avoid head-on competition with the giants.