According to the Press Release No. 30/2020 issued by the Bank of Thailand (the “BOT”) on 18 August 2020, the BOT announced the project to develop the prototype business payment system using Central Bank Digital Currency or CBDC.
The project is “the intuitive next step from Project Inthanon which is the collaborative project between the BOT and the eight leading financial institutions to develop the proof-of-concept for using wholesale CBDC for domestic wholesale funds transfer”. Feasibility studies and the development of integration processes linking the CBDC with the business’ innovative platform started in earnest and is expected to be completed by the end of 2020, after which the BOT will publish the summary and the contents of the project accordingly.
In January 2020 Project Inthanon accomplished the cross-border transfer prototype which is co-developed with the Hong Kong Monetary Authority (HKMA). The BOT will announce further innovations later relating to other uses of CBDC by experimenting and collaborating with the HKMA and the participating financial institutions.
The benefits of using CBDC are set forth as follows:
- To enhance competitiveness and readiness of the business sector entering the digital
- To broaden CBDC’s latitude and adoption to new audiences,
- To enable higher payment efficiency for businesses such as increasing flexibility for fund transfers
- To deliver faster and more agile payments between suppliers.
Bank of Thailand’s prototype comes at a time when central banks around the world have been brainstorming with the idea of CBDCs. For further assistance in relation to doing business in Thailand contact our Bangkok business specialist at firstname.lastname@example.org