Krungsri (Bank of Ayudhya PCL) has launched a cross-border QR payment service between Thailand and the Lao People’s Democratic Republic (Lao PDR), allowing travelers to make easy payments for products or services.
Key Takeaways
- Krungsri announced the launch of its new QR payment services for Thai tourists visiting Lao PDR.
- This service allows travelers to make payments easily, quickly, and securely using the KMA krungsri app.
- The bank’s launch aligns with the recent BOT initiative known as the ASEAN Payment Connectivity initiative.
Krungsri has become the first commercial bank to introduce cross-border QR payment services for Thai tourists visiting Lao PDR through the KMA Krungsri app. This innovative service enables outbound travelers to transact with merchants effortlessly, swiftly, and securely. In line with the Bank of Thailand’s strategy, the service is scheduled to officially launch on July 5, 2024.
The service will focus on Thai tourists visiting Lao PDR, who will be able to scan the code and use it with merchants that accept this type of payment.
The bank’s expansion in the ASEAN region includes the introduction of cross-border QR payment, which is one of Krungsri’s innovative financial solutions. This initiative aims to enhance the payment experience and align with the global trend towards digital finance. The cross-border payment connection between Thailand and Lao PDR complements Krungsri’s existing services in Japan, Cambodia, Indonesia, Malaysia, Singapore, Vietnam, and Hong Kong.
Ninlawan Jerraboon, Krungsri’s head of Transaction Banking Group, explained that QR codes are used by tourists and businesses to facilitate transactions and commercial operations between both parties.
The bank’s launch aligns with the recent BOT initiative known as the ASEAN Payment Connectivity initiative.
It aims to promote the adoption of digital payments and boost the economies of the member countries of the ASEAN region.
Digital payments are increasing in Thailand
The QR code payment industry has seen significant adoption across Southeast Asia, driven by factors like growing smartphone penetration, the rise of fintech e-wallets, changes in user behavior due to the pandemic, and government support.
As a result, numerous bilateral cross-border QR code payment linkages are being launched, creating an ASEAN interoperable QR code payment ecosystem—a first of its kind globally1. This ecosystem benefits consumers, merchants, e-wallets, and banks, and it serves as a valuable case study for other regions seeking financial integration through digital payment initiatives.
The volume of QR code payments in Southeast Asia is expected to grow from 13 billion in 2023 to 90 billion in 2028, with countries committed to creating a regional QR cross-border payment network. This system involves central banks working directly with one another, making transactions more efficient and less costly. QR codes are playing an increasingly important role in cross-border payments in Southeast Asia, and the industry may see more QR cross-border payment linkages worldwide.
Thailand has made significant strides in the development of digital payment systems, aligning with the vision of transitioning to a ‘less cash’ society. The Bank of Thailand (BOT) has been at the forefront of this transformation, implementing a strategic plan that spans from 2022 to 2024, focusing on Openness, Inclusivity, and Resiliency.
Openness in the digital payment landscape has been a key driver, with the BOT promoting the use of shared payment infrastructures and information to increase efficiency and foster innovation. A notable initiative is the development of “PromptBiz,” a unified infrastructure for trade information and digital payments. This, along with the adoption of international standards like ISO 20022 and APIs, has enhanced Thailand’s role in cross-border payments.
Inclusivity has been another pillar, ensuring broad access to digital payment services for all demographics. Collaborations between the public and private sectors have expanded digital payments to specific target groups. Practical applications have been introduced, such as digital payment channels for public transportation and the expansion of digital services in public sector mobile applications.
The Resiliency of the payment systems has been bolstered by providing a proper governance structure to support rapid development and integrating payment databases with government data frameworks for broader data usage benefits.
These efforts have collectively enhanced the quality of life for Thai citizens, improved competitiveness, and supported the sustainable transition of the financial sector to a digital economy.
