Payment methods available for consumers may generally be divided into cash payments and non-cash payments.Cash payment
Cash payment is the most traditional, common and widely accepted payment method in Thailand. Payments made by consumers to recipients by cash are subject to and governed by the provisions under the CCC; for example, the provisions on contracts and debts. The BOT is the main authority responsible for the issue and management of banknotes and other government notes, as well as the formulation and implementation of monetary policies.Non-cash payment
Apart from cash, payments can be made by paper-based methods. Examples of paper-based payments include payment orders, cheques, bills of exchange and promissory notes. These modes of payments are governed by the CCC. Relevant service providers such as issuing banks would be subject to control measures under the rules and regulations announced by the BOT from time to time.
Non-cash payments may also be made on a paperless basis. In such cases, payment may be effected by the use of debit cards, credit cards, prepaid cards or other cards of a similar nature. There are also certain paperless payment services that do not require the use of any cards, and are available on electronic or online platforms accessible from computers, tablets, smartphones and other compatible devices. The most common services would be electronic fund transfers and online applications known under various names depending on the relevant service providers (e.g., mobile banking/m-banking, internet banking/i-banking or cyber banking). As no physical money is used or transferred in such transactions, the paperless payment would sometimes be referred to as 'e-money'.
Paperless payments are governed under the provisions concerning contracts and debts under the CCC, together with the Electronic Transaction Act 2001, which is the main law regulating electronic transactions. Additionally, the Payment Systems Act 2017 (PSA) was enacted to ensure additional security and credibility for services provided by electronic means. The PSA requires service providers to notify, register, or obtain permission from the BOT before providing each type of electronic payment services.
As cash management normally involves complicated and costly processes (such as handling, transporting, sorting out damaged or soiled banknotes for destruction, and implementing security measures throughout the said processes), there have been initiatives to reduce cash usage so as to minimise processing costs and expenses. Several cashless payment methods were therefore introduced and promoted by the Thai government and authorities in recent years.ii Recent developmentsNational e-Payment Master Plan – PromptPay
The PromptPay or Any ID system (PromptPay) was officially introduced for the first time in July 2016. It allows a fund transfer to be made to or from a bank account by using a Thai ID card number or mobile phone number of the account owner (instead of a bank account number). A Thai national can choose to register his or her ID card number or mobile phone number with one bank account held with any bank in Thailand.
From January 2017, corporate entities have been able to apply for PromptPay by registering its 13-digit corporate registration number with one savings account or current account held with any bank in Thailand.
PromptPay was implemented under phase 1 of the National e-Payment Master Plan initiated by the Thai government in 2015, the main objective of which is to develop an integrated e-payment infrastructure for fund transfers and payment systems between the government and the private sector. In particular, the infrastructure is intended to be used as the main (and probably the only) channel through which tax and social security disbursement payments will be made by the government to private sectors (i.e., the e-tax system and e-social welfare system, respectively). Ultimately, the government aims to transform Thailand into a 'cashless society' where purchases of goods and services are made by credit cards, electronic fund transfers, or any other methods under the Plan, in lieu of cash or cheques.QR Code Payment System
The BOT has approved the launch of the Quick Response Code payment service (QR Code Payment) by five commercial banks in November 2017, and for three other commercial banks in December 2017. Under this system, customers are able to use mobile phone applications to scan standardised merchant QR codes for cashless purchases and payment for products and services. The payment would then be charged to the customer's credit card, savings account or e-wallet, by his or her choice for each purchase.The Payment Systems Act 2017
The PSA was published in the government gazette on 18 October 2017 and came into effect on 16 April 2018. The PSA consolidates and reforms existing payment laws to bring them in line with international standards of governance. The PSA classifies e-payment related businesses into three categories; namely, important payment systems, regulated payment systems and regulated payment services.
The Ministry of Finance has issued two notifications, which set out details of specific activities that would fall under the category of the designated payment systems, and designated payment services. Moreover, the BOT has issued several notifications that set out the rules, procedures and conditions for the process of licensing and registration, as well as rules relating to the supervision of the operation of each type of payment system and service.