Thailand Post considers becoming virtual banking agent

Thailand Post, the government-owned logistics firm, is examining the possibility of becoming a neutral virtual banking agent to supplement the functions of emerging virtual banks, according to Chief Executive Dhanant Subhadrabandhu. The national organisation plans to use its extensive network of 1,600 branches and a delivery workforce of 25,000 to support this initiative.

Serving as a neutral virtual bank agent presents a fresh business prospect for Thailand Post’s ongoing financial and retail operations, Dhanant stated. The company is slated to decide by June on its potential participation in the evolution of virtual banks, three months before the Bank of Thailand’s September cut-off for virtual bank applications.

Contrary to the primary digital nature of virtual banks, Thailand Post could simplify these operations by acting as a physical touchpoint via its branches and delivery personnel, Dhanant suggested. For instance, Thailand Post could assist unbanked individuals or migrant workers who are paid daily in cash to deposit their earnings through the virtual banking system. Delivery staff could introduce customers to a range of virtual bank services at their homes.

Thailand Post could offer associated services as a virtual bank agent across its 1,600 branches, Dhanant added. The company already functions as a banking agent for all banks, facilitating deposits and withdrawals using bank account passbooks at its postal branches.

Thailand Post is currently in discussions with several banks that could potentially transition into virtual banks to jointly investigate the feasibility of a proposed neutral banking agent partnership, according to Dhanant. The state-owned enterprise could also contemplate acquiring shares in a consortium planning to apply for a virtual bank licence.

Dhanant confirmed that discussions have been held with several major commercial banks as well as non-bank companies that operate diverse businesses through a retail consumer base. However, these discussions have not yet concluded.

Migrant workers

Thailand Post believes it could assist lenders with several operations.

“Apart from Thais, one target group for virtual bank service is migrant workers who do not receive a pay slip from their employer.”

This latest strategy aligns with Thailand Post’s core goal to transition from last-mile delivery to a first-mile service, striving to be recognised by Thais for its services and trusted for its quality, Dhanant stated.

Thailand Post recently set a bold profit target for this year of 350 million baht, a significant increase from last year’s 78 million. Last year marked the first time in three years that the state enterprise recorded a net profit, reported Bangkok Post