Suphachai Chearavanont, Vice President of Charoen Pokphand Group and Chairman of True Corporation, announced that Ascend Virtual Bank will begin its operations in July 2023. This announcement comes at a time when interest in digital banking is growing, as the new bank aims to meet the needs of underserved customers in the market.
In a related context, the competing Clicx Bank announced its plans to launch its mobile application on June 19, reflecting the increasing competition among digital banks in Thailand. Clicx Bank was jointly established by Krungthai Bank, Advanced Info Service, and PTT Oil and Retail Business, and it received its license on May 14, making it the first of three applicants to gain approval from the Bank of Thailand.
Event Details
Despite concerns raised about Ascend Bank lagging behind its competitors, Suphachai confirmed that starting operations a few months later than competitors is not a significant issue in the group's long-term strategy. He noted that the Bank of Thailand has granted licenses to other virtual banks, but some applicants have requested to delay their operations.
Among other applicants, there is ACM Holding backed by CP, along with the SCB X alliance that includes KakaoBank and WeBank. Somchai Lertlarpwasin, Assistant Governor of the Bank of Thailand, indicated that other applicants have requested delays in their operations, providing Ascend Bank with an opportunity to launch strongly.
Background & Context
Virtual banks are part of a larger digital transformation in the financial services sector, where companies are striving to offer more flexible and accessible banking services to customers. In recent years, Thailand has seen an increase in the number of digital banks, reflecting a shift towards innovation in this sector.
Founded in 1921, Charoen Pokphand Group is one of the largest companies in Thailand, operating in various fields including agriculture, retail, and technology. By entering the world of digital banking, the group aims to enhance its position in the financial market by offering innovative banking services.
Impact & Consequences
The entry of Ascend Bank is expected to enhance competition in the Thai banking market, potentially leading to improved services for customers. This competition may also contribute to reduced costs and increased options available to customers, thereby enhancing the user experience.
Furthermore, the emergence of new digital banks may help promote financial inclusion in Thailand, as these banks can provide their services to customers who have been unable to access traditional banking services.
Regional Significance
Thailand's experience in developing digital banks serves as a model for the Arab region, where many Arab countries are seeking to enhance innovation in the financial sector. Arab nations could benefit from the lessons learned from Thailand's experience in developing digital banks that meet the needs of local populations.
In light of the global trend towards digitization, it may be beneficial for Arab countries to explore opportunities for collaboration with technology companies to develop innovative banking solutions that cater to market needs.