Fintech Taking Over Thai Banking Figures

The Bank of Thailand has released data about the country’s physical bank branches. In the table entitled “Physical Branches in Firing Line”, the BoT showed how the various banks in Thailand have fared in terms of branching out.

As seen on the table, there is a general decline in physical branches. Most are coming from Kasikornbank which lost 17 branches and Thanachart Bank which lost 16 branches. The biggest losers are the fourth and fifth largest bank in Thailand respectively.

Meanwhile, both Krungthai Bank and TMB Bank were down by three branches. The Thai branch of Standard Chartered dropped by two while Siam Commercial Bank lost one branch.

The biggest gainer is Bangkok Bank which added three branches while Thai Credit Retail Bank, ICBC Bank, and Bank of Ayudhya expanded by only one branch.

According to experts this decline in statistics can be attributed to the growing presence of financial technology or fintech. In short, more and more Thais are going digital. As a consequence, traditional banks are essentially forced to go online to keep up with competition. A senior official of the Bank of Thailand was interviewed by the Bangkok Post saying that the “fast-growing fintech is shifting consumer behaviour towards the digital banking channel and forcing commercial banks to pare down their brick-and-mortar branch networks.”

BoT’s assistant governor for financial institutions policy group, Somboon Chitphentom commented on the matter saying, “Since the beginning of this year, most commercial banks have shuttered more branches than they have opened to adapt to the change in customer behaviour and lifestyle.”

He further explained that technologies are gaining traction all over the financial industry. Payment solutions such as cost-efficient approaches are being utilized to attract and maintain a solid user base. He said, “As a result, these banks have adapted by reconsidering their branch size, relocating existing branches and adding more service channels such as mobile or internet.”

Thai commercial banks are gradually realizing the importance of fintech and they are adapting to stay relevant in the financial industry.