24-8-2023 (BANGKOK) Experts in the field of blockchain and technology are optimistic about the potential of the Pheu Thai Party’s proposed digital wallet scheme to revolutionize Thailand’s digital payment infrastructure and stimulate economic growth.
Although the scheme initially involved the use of blockchain technology, analysts suggest that it may not be necessary to incorporate blockchain into the project. Additionally, creating a new digital wallet application might not be a prerequisite for its implementation.
The digital wallet scheme, a campaign promise made by the Pheu Thai Party, has garnered significant attention following the parliamentary vote in favor of Srettha Thavisin as Thailand’s 30th prime minister.
Mr. Srettha, expressing his commitment to improving the living conditions of Thai citizens, stated on Tuesday that he is prepared to take action.
According to Paopoom Rojanasakul, the deputy secretary-general of the Pheu Thai Party, the proposed scheme aims not only to stimulate the economy but also to establish a nationwide blockchain-based financial payment system. Thailand would be among the first countries to introduce such a system.
Under this scheme, every Thai citizen aged 16 and above will receive a 10,000-baht digital handout delivered to their smartphones. The digital funds can only be used within a four-kilometer radius of the recipients’ residences, although flexibility may be granted based on individual locations.
The digital currency remains valid for six months, and registration is not required to access the digital wallet. Individuals without access to the digital wallet app can obtain a personal code using their national ID cards to spend the digital funds.
Sathapon Patanakuha, CEO of SmartContract Blockchain Studio, believes that the scheme has the potential to stimulate the economy and enhance the country’s digital capabilities. By establishing a new digital payment infrastructure, the government can effectively promote targeted policies and provide subsidies to sectors such as small and medium-sized enterprises (SMEs).
Mr. Sathapon further emphasized that this infrastructure would enable SMEs to gain improved access to financial services and infrastructure. He also highlighted the cost reduction potential of utilizing blockchain-based digital ID systems for Know Your Customer (KYC) procedures.
According to Mr. Sathapon, blockchain technology can be implemented in various architectures with different levels of complexity, management, security, and privacy. He suggests that the focus should be on the vision and use cases rather than the technology itself, advocating for a hybrid approach combining blockchain with other technologies.
For instance, the government could introduce digital coupons for travel in second-tier tourism cities or launch a Central Bank Digital Currency in select provinces, leveraging a mix of technologies including blockchain.
However, Mr. Sathapon raised concerns about the responsibility of handling the KYC process, a standard practice in the investment and financial service sectors for customer verification. He referred to Krungthai Bank’s Paotang app, which has played a pivotal role in government subsidy schemes and possesses multiple branches for KYC support.
Mr. Sathapon suggested that the new government should invite existing digital wallets and mobile banking apps to participate in the digital money scheme. He believes that the ultimate goal of the Pheu Thai digital wallet project is to establish a third financial payment system, distinct from traditional banking and credit card providers.
Furthermore, Mr. Sathapon proposed that the government could utilize this new wallet as a platform to promote state projects, encouraging swift adoption. By doing so, the government would have an additional channel to implement its policies, bypassing the existing state digital mechanism.
As a blockchain entrepreneur, Mr. Sathapon expressed his support for projects that enhance Thailand’s digital capabilities, asserting that increased access to digital wallets would greatly unlock the country’s potential.
Thanachart Numnonda, founder of IMC Institute, pointed out that there are already numerous digital wallet apps with substantial customer bases, including the Paotang app. Hence, he argued that there is no necessity to develop a new digital wallet.
Mr. Thanachart stressed that the Pheu Thai digital wallet scheme is a significant undertaking, and careful consideration should be given to its rapid implementation and scalability. He suggested that the government may intend to leverage its own digital payment infrastructure to facilitate welfare payments within existing systems.
To achieve this, Mr. Thanachart proposed that the government could transfer funds through the Paotang app and other digital wallets by utilizing the country’s central database.
