Thailand's Payment Technology Forecast for the Next Five Years

Thailand's payment technology will undergo rapid change over the next five years (2024-2029), driven primarily by the growth of the digital economy, government policy drivers and changes in consumer behaviour. Below are the key predictions and analyses:

1. Full penetration of digital wallets and QR code payments

• status quo: Thailand is already a leader in QR code payments in Southeast Asia (e.g. PromptPay), but cash still accounts for a certain percentage.
• anticipate::
  • Digital wallet usage is set to rise to more than 801 TP3T from about 501 TP3T in 2023 (refer to Bank of Thailand data).
  • QR code payments will reach more micro and small merchants and rural areas, and the government may accelerate penetration through subsidies.
  • challenge: Acceptance by older or low-income groups takes time to develop.

2. Facilitation of cross-border payments

• driving force::
  • ASEAN regional economic integration (e.g. Thai Baht with direct settlement of Singapore dollar/Malaysian ringgit).
  • Tourism recovery to drive cross-border payment demand (Chinese tourists rely on Alipay/WeChat Pay, Thai local systems to enhance interfacing).
• anticipate::
  Blockchain technology may be used to reduce the cost of cross-border transfers, with banks partnering with fintechs to launch real-time foreign exchange services.

3. Explosive growth of BNPL (buy now pay later)

• status quo: Lazada, Shopee already offer BNPL services, but the penetration rate is less than 10%.
• anticipate::
  The market may triple in size by 2029 (Ken Research estimate) and is particularly sought after by Generation Z. Regulation may introduce an interest rate cap policy to guard against over-indebtedness risk.

4. CBDC (Central Bank Digital Currency) pilot expansion

Retail CBDC in Thailand expected to enter limited commercialisation after 2025
Initial applications for business-to-business settlements and government welfare payments
Success could reduce reliance on SWIFT.

5. biometric authentication become standard

Fingerprint/Face Recognition Adoption in Mobile Banking Apps Exceeds 90%
Voice Recognition Technology May Be Rural First Due to Lower Costs

Risks and challenges

✅ Cybersecurity threats on the rise → Need to invest more in defence
✅ Slow transformation of traditional banks → Possible M&A tie-ups with fintech companies
✅ Regulation lags behind the pace of innovation

In conclusion, Thailand's payment market will become more convenient and seamless, but balancing innovation with risk management is key. Merchants should upgrade their POS systems as soon as possible, while consumers need to become more digitally literate to protect their assets.

6. Super App (Super App) integration of the payment ecosystem

• status quo: Platforms such as Grab and Line Man have aggregated a variety of services (taxis, takeaways, money transfers), but payment functionality is not yet fully integrated.
• anticipate::
  • Over the next five years, local Thai companies (such as TrueMoney or Kasikorn Bank's K+) may launch "full-scene" super-apps that integrate e-wallet, investment, insurance and other functions.
  • opportunity point: Providing personalised financial products (e.g. credit facilities based on consumption history) through user behavioural data.

7. Social e-commerce and the rise of Embedded Finance

• driving force: The explosive growth of TikTok Shop and Facebook Marketplace in Thailand.
• anticipate::
  • The popularity of the "pay as you shop" model - where consumers complete transactions directly within social media without having to jump to a bank app.
  • Platforms such as Instagram/LINE may join hands with local banks to launch "small shop loans" to provide liquidity for small and micro sellers.

8. AI-driven dynamic risk control and anti-fraud

Traditional rules engine → AI to analyse transaction behaviour in real time (e.g. geolocation/device fingerprinting)
Case in point: SCB already uses AI to intercept suspicious transfers, may expand to BNPL credit assessment in future

9. Experimental Internet of Things (IoT) Payment Scenarios Hit the Ground Running

Self-driving taxis with automatic fare deduction
Smart fridge senses inventory and automatically places order for payment

Changes in the regional competitive landscape

✅ Invasion of Fintech Companies in Singapore → GrabPay or Revolut may acquire local Thai payments business
✅ China's technology export accelerates : Ant Group partners with local banks to develop customised solutions

Key turns in policy regulation

1. Beyond 2025 : 'Real name + KYC' may be mandatory for all digital wallets to combat money laundering
2. Data Sovereignty Act : Restrictions on where cross-border payment data can be stored affect international players' operating costs

Recommendations for action

🔹 enterprise side : Apply for an E-Money Licence in advance to avoid compliance snags
🔹 user terminal : Watch for biometric update notifications in case account access is restricted

Is there a need to explore a particular area in depth? For example, specific technology paths for rural financial inclusion?