Virtual Bank: New Option for the Thai Financial System

Abstract

This academic article presents that the rapid advancement of technology in the modern era has been significantly influenced by the emergence of the internet, a transformative innovation that has facilitated the transition from analog to digital systems. This paradigm shift has profoundly impacted human behavior, economic structures, and society at large. In response to these changes, commercial banks have undergone substantial transformations, shifting from traditional, branch-based operations (commonly referred to as "Bricks and Mortar") to the adoption of branchless, virtual banking services. These services are accessible through digital platforms, including personal computers, mobile devices, and other electronic technologies. While this model presents numerous advantages, such as enhanced accessibility, reduced geographical and temporal constraints, and cost savings for both consumers and service providers, it also introduces certain limitations. Notably, it allows users to conduct financial transactions more efficiently while enabling financial institutions to minimize expenditures related to employee wages and physical infrastructure. In Thailand, the Bank of Thailand is currently evaluating strategies to enhance the accessibility of financial services, particularly for marginalized populations, including low-income individuals, those with unstable incomes, small and medium-sized enterprises (SMEs), underserved communities, unserved groups, and individuals burdened by informal debt. It is anticipated that by 2026, at least three service providers will commence operations, offering a new option for financial system inclusivity within the country.