Virtual banks to bolster financial inclusion

Virtual banks are 10 times more likely to reach untapped retail customers than traditional banks, improving the country's rate of financial inclusion, say new industry players.

- SOMRUEDI BANCHONGDUANG

According to Tanyapong Thamavaranukupt, co-president of Ascend Money, the planned virtual banks are expected to serve 7-19 million individuals, compared with 2-3 million served by existing traditional banks.

As a result, the virtual banking business should enhance financial inclusion in line with the Bank of Thailand's requirements, he said at the "Virtual Bank: Game Changer for Financial Thailand" seminar yesterday.

However, Ascend Money's virtual bank will offer lower lines of credit than traditional banks, likely between 3,000-5,000 baht per individual customer, compared with the 70,000-100,000 baht typically offered by traditional banks, he said.

On June 19, the central bank announced the three successful applicants to establish the country's first batch of virtual banks.

They are required to commence their business operations within one year of the date of the Finance Ministry's approval, which was granted on June 19.