THAILAND Trends and Developments Contributed by: Wongsakrit Khajangson, Panupan Udomsuvannakul, Koraphot Jirachocksubsin and Pitchaya Roongroajsataporn, Chandler Mori Hamada
While introducing virtual banks is poised to bring numerous benefits, it also comes with its own challenges. The high level of household debt in Thailand remains a significant hurdle for both traditional and virtual banks in the retail sec - tor. Additionally, the underbanked market tar - geted by virtual banks comes with higher risks, necessitating substantial capital investment. Applicants for a virtual bank license must have a minimum capital of THB5 billion, and experts suggest that lending to underserved markets could require up to THB50 billion in capital due to the higher risk involved. The introduction of virtual banks is expected to enhance financial inclusion and drive inno - vation in Thailand’s financial sector. Successful applicants will play a crucial role in shaping the future of banking, promoting economic growth, and setting new standards for digital financial services. Challenges Posed by Cybercrime and Scams Despite these advancements, the rise of fintech has also created vulnerabilities. Cybercriminals have exploited the convenience and anonymity of digital platforms to carry out fraudulent activi - ties. Online scams, particularly call centre fraud, have become a growing concern. In Thailand, the total losses from cybercrime between March 2022 and November 2024 reached THB 77.36 billion, underscoring the urgent need for stronger cybersecurity measures. Fraudsters often use psychological manipula - tion, impersonating trusted entities to deceive individuals into transferring money. Common tactics include fake job offers, phishing schemes, and lottery scams. The impact of these scams extends beyond financial losses. They erode public trust in digi -
tal platforms, discourage the adoption of fintech solutions, and tarnish the reputation of legitimate service providers, especially among those who do not understand technology. This highlights the importance of robust cybersecurity frame - works to protect users and maintain confidence in the fintech ecosystem. The Amended 2023 Emergency Decree: A Game Changer for Cybersecurity In response to the growing threat of cybercrime, the Thai government plans to introduce the Amended 2023 Emergency Decree. This legis - lation, set to take effect in early 2025, represents a significant step forward in protecting consum - ers and holding stakeholders accountable. Key provisions of the law include: Shared responsibility framework Financial institutions, telecom operators, and social media platforms are now required to work together to prevent cybercrime. If they fail to implement adequate preventive systems, they will be held financially liable for any consumer losses. This implementation will align Thailand with global best practices, such as Singapore’s Cybersecurity Strategy and Malaysia’s Financial Banks and telecom operators must implement stricter identity verification measures. This includes requiring ID cards for SIM card regis - tration and verifying customer information when opening new bank accounts. These measures aim to prevent the misuse of “mule accounts” often used by fraudsters. Accountability for telecom operators Telecom companies are mandated to remove suspicious messages promptly. Failure to do so will result in financial liability if these messages Consumer Alert mechanism. Enhanced KYC protocols
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