Thailand is making the move to cashless economy

Thailand is taking a step further to a cashless economy. From March 27, all states agencies will be required to make and receive payments through the electronic system. States enterprises are required to adopt this system over the next 6 months.

This requirement is a part of a global plan, the so-called “National e-payment Master Plan”, which aims is to transform Thailand into a less cash-reliant economy.

What is the National e-payment?

National e-Payment is a government initiative that aims to increase the efficiency of Thailand’s payment infrastructure system, helping the public make e-payments more easily and conveniently. The scheme consists of 5 modules:

  • Prompt Pay:  It is an alternative way to receive and transfer funds using his Citizen ID or mobile phone number without needing to provide an account number.
  • Debit Card Usage Expansion: This module aims to expand the use of electronic cards instead of cash, while expanding the installation of Electronic Data Capture (EDC) machines and mobile point-of-sale (MPOS).
  • E-Tax system: This module should enable electronic submission of tax documents, particularly e-Tax invoice and e-Receipt. With time, the purpose is to put all e-payment transactions into a taxation data system.
  • Government Payment and Subsidies: This module aims to upgrade government financial transactions from traditional cash to electronic form.
  • Education and Incentive Campaigns: The final phase of the national e-payment scheme is campaigns and incentives such as tax breaks and other rewards to encourage people to make e-payments.

What are the benefits?

The benefits are numerous for the Thai economy. Electronic payments reduce transaction costs, gives people better access to financial services, enhance the efficiency of operations and help the government support low-income earners. Studies shows that business that installed e-payment option increases sales by at least 17%.

Financial technology (“FinTech”) has been transforming the financial landscape. The cashless society seems inevitable. Thailand is in the perfect position to reap the benefits and to improve Thailand’s global competitiveness by being an early adopter.

Is Thailand close to go cashless?

Thanks to the National e-payment scheme, electronic payments took off in Thailand in 2017. The conditions are ideal for the expansion of the electronic payment industry. Even if Thailand is not ready to go cashless in 2018, the infrastructure is there to make the transition within the next 3 years.