Yesterday, Bank of Thailand (BOT) announced three selected out of five submitted applicants qualified to form virtual banks. Those applicants are as follows:
1) ACM Holding Company Limited (True Money), which is a joint venture of Charoen Pokphand Group Company (CP) through Ascend Money Company Limited (TrueMoney service provider) and Ant Financial Services Group, an affiliate of Alibaba Group.
2) Krung Thai Bank Public Company Limited (SET: KTB) that collaborates with Advanced Info Service Public Company Limited (SET: ADVANC) and PTT Oil and Retail Business Public Company Limited (SET: OR).
3) SCB X Public Company Limited (SET: SCB) that collaborates with WeTechnology Limited and KakaoBank Corp.
The other two applicants that did not pass the qualification are as follows:
4) BTS Group Holdings Public Company Limited (SET: BTS) which collaborates with Bangkok Bank PCL (SET: BBL), Singapore’s Sea Group, Sahapat Group, and Thailand Post.
5) Lightnet Group, Thailand’s fintech company, which collaborates with Hong Kong’s WeLab.
Mrs. Roong Mallikamas, Deputy Governor Financial Institutions Stability of BOT, stated that in the future, BOT may open a new round of applications for virtual bank licenses, with previously unqualified applicants allowed to reapply. However, the BOT would first be required to monitor the progress and operations of the three groups from this round before making further announcements regarding the license.
Regarding the concern on whether providing licenses to these conglomerates would allow them to dominate the market, Mrs. Roong pointed out that clear and strict measures will prevent such an event from happening. Furthermore, during the interview process, the entrepreneurs vowed to operate according to BOT’s principles.
In the next 3 – 5 years from the initiation of virtual banks, the BOT will monitor each of their progress closely, whether they follow the written criterias, and the overall performance of their systems.
In the future, the virtual bank’s entrepreneurs will be allowed to add new partners, but the process must not significantly change the shareholder’s structure. Otherwise, the group must seek BOT’s approval before such an attempt.
