Earlier this year the Thai government launched a new payment system that worked digitally and we’ll be digging deeper into this payment system and how it works, but we are certain of the fact that this payment system contains some challenges. This can be expected, most start-ups face its challenges, but we might have a solution for these problems. And this solution is blockchain, so let’s wait no longer and dig a little deeper into what blockchain can mean for the Thai payment system.

How does the Thai payment system work?

In the first months of 2017 the Thai government launched a digital payment system. The system is called the PromptPay service and will be both beneficial for the people as the bankers. The PromptPay service has fees that are way lower than the fees you pay to the central banks, and although this sounds like revenue loss for the banks, this revenue loss isn’t as much as the money that they are saving by the expected reduction in the costs for cash money. The Thai commercial banks as well as the national banks have been making attempts in the recent years to revolutionize the payment system and make it work a lot smoother and efficient.

The challenges for the Thai payment system

As you might expect, the Thai payment system faced its challenges as well. Firstly, there are little financial regulations that apply to digital payment and things like cyber fraud.

An electronic payment system may sound great, but many Thai banks lack the IT skill to work with these digital payment systems. And many smaller banks use VPN’s to make use of the network, which offers a lot of security issues.

International value transactions are very inefficient and very high fees need to be paid, which is not handy for the people that do need to make transactions to other countries.

The way blockchain technology can offer a solution

The problem with regulation can’t be solved completely by blockchain, as blockchain doesn’t suddenly create regulations, but it can help with cybersecurity. As you might know, blockchain works with encryption, a decentralized database and complete transparency. These features make it close to impossible for people to commit fraud or hack the blockchain, which makes the entire payment system a lot safer.

Blockchain technology is a relatively simple technology to use, so the IT competency of small Thai banks doesn’t have to be a problem. On top of this, there is no need for using VPN’s, as the blockchain is a network of its own.

Blockchain knows no borders, and the entire problem of international transactions would be solved when making use of blockchain technology. It doesn’t matter what country you are in or what nationality you possess, everyone can use blockchain. This way international transactions won’t cost any fees and will be a lot more efficient.

As you can tell, the blockchain technology can solve a lot of problems faced by the Thai government when it comes to their new digital payment system. We believe that the Thai government should see this blockchain technology as an option when it comes to their new digital payment system, it is able to solve a lot of their problems. But what do you think of this? Do you think that blockchain is the answer to the problems of the Thai payment system or do you believe something entirely different will do the trick?