Despite being somewhat of a laggard compared with the likes of Indonesia and Singapore, Thailand’s fintech industry is developing well and featuring today some 107 startups, a new startup map released by the Fintech News Network shows.
The Fintech Thailand Startup Map 2023, which takes a look at the country’s fintech startup ecosystem and key verticals, reveals that the landscape has evolved steadily, growing from 97 companies in 2020 to 107 in 2023.
Data show that the blockchain sector is rising in prominence to become the top fintech vertical with 21 ventures. This comes to the detriment of the payment sector, which retrieved considerably from 20 companies in 2020 and now 14.
The space is rising on the back of soaring cryptocurrency trading activity in the country. According to Statista, a German research firm and statistics portal, Thailand has one of the highest crypto ownership rates in the world. In 2022, 44% of the Thai consumers polled by the company said they owned or used crypto, behind only Nigeria (45%). The figure represents a 13 percentage point increase compared with a year prior (31%), and shows that crypto adoption is picking up fast in the Southeast Asian country.
Rising adoption of crypto in Thailand comes despite the ongoing regulatory clampdown the sector has been experiencing. In September 2022, Thailand’s financial regulator banned crypto firms from offering staking and lending services, and established stricter crypto advertising rules. Most recently, new regulations for crypto custody activity took effect, mandating providers to establish a digital wallet-management system to ensure the safety of customers’ assets.
But in parallel, the central bank has been pursuing central bank digital currency (CBDC) opportunities, launching earlier this month a trial for a retail CBDC involving three financial services providers, the Bangkok Post reported on June 12. The new system is intended to improve the convenience and efficiency of financial transactions with lower costs.
Bank of Thailand is also part of Project mBridge, an initiative led by the Bank for International Settlements (BIS) that seeks to utilize blockchain technology and CBDCs for more efficient and cost-effective cross-border payment transactions.
Notable blockchain and crypto startups in Thailand include BitKub, the country’s leading crypto exchange; FWX, a digital asset and blockchain startup worth a reported US$50 million; and Atato, a cryptocurrency wallet and custody provider that recently secured a US$6 million Series A.
After blockchain and crypto, payments is the second largest fintech vertical in Thailand with 14 companies among which TrueMoney, an award-winning e-wallet app; 2C2P, a full-suite payments platform; and Rabbit Line Pay, a payment system and e-wallet in the popular Line messaging app.
Payment innovation in Thailand has been facilitated by PromptPay, the country’s real-time payment scheme which has enabled since 2017 a steady stream of innovation, including payment by corporate ID proxy, QR retail payments and request-to-pay functionality.
Thailand’s PromptPay system is one of the most mature and successful real-time payment infrastructure in the world, a report by payment software provider ACI Worldwide says. In 2021, the system recorded 9.7 billion real-time transactions, making Thailand the fourth leading country in the world in terms of instant payment usage. Widespread adoption of PromptPay resulted in an estimated cost savings of US$1.3 billion for businesses and consumers in 2021, which helped to unlock US$6 billion of additional economic output, the firm estimates.
The system has also been extended to cross-border transactions through linkage between PromptPay and Singapore’s real-time payment system PayNow.
Besides blockchain and payments, insurtech and wealthtech are other prominent fintech verticals in the Thai fintech industry, comprising 11 startups each. Notable startups in the sectors include Eazy Digital, an insurtech software-as-a-service (SaaS) company that recently raised US$850,000 in an oversubscribed seed funding round; Sunday, a fully-integrated sales and services insurtech company that has secured US$75 million in funding; and Finnomena, a fast-growing investment and portfolio management app that has amassed THB 30 billion (US$867 million) in assets under management (AUM).
Other fintech verticals represented in the Thai fintech industry include financial comparison, business tools, small and medium-sized enterprise (SME) finance, alternative finance, regtech and personal finance.
Digitalization has been among Thailand’s top strategic priorities. Thailand 4.0, a national plan launched in 2016, focuses on innovation and high‐level services, propelled by advanced digital technology. The initiative aims, among other things, to step up the country’s financial infrastructure, support the growth of fintech businesses and improve financial inclusion.
Thai fintech startups raised a total of US$260 million in funding last year, up 20% from the previous years, reports by the United Overseas Bank, PwC Singapore and the Singapore Fintech Association show. The sum makes Thailand the fourth biggest recipient of fintech funding in 2022, behind Singapore (US$1.8 billion), Indonesia (US$1.4 billion) and the Philippines (US$337 million).
Fintech Thailand Startup Map 2023
Featured image credit: Edited from freepik
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- Source: https://fintechnews.sg/75450/thailand/fintech-thailand-startup-map-2023/
