Krungsri and the Bank of Thailand commence the pilot test of a Retail CBDC, leading Thailand into the new chapter of digital finance

Friday 05 August 2022 14:07
Krungsri (Bank of Ayudhya PCL), a member of the Mitsubishi UFJ Financial Group (MUFG), one of the world's largest financial institutions, announces another milestone as it becomes one of the first banks awarded the opportunity to undertake a pilot test of the 'Retail CBDC' within a limited scale by the Bank of Thailand (BOT). The pilot test will commence from the end of 2022 to mid-2023.
Krungsri and the Bank of Thailand commence the pilot test of a Retail CBDC, leading Thailand into the new chapter of digital finance

For the first time in Thailand's financial history, the BOT will issue a digital currency called the "Digital Baht" (Retail Central Bank Digital Currency or Retail CBDC). Holding the Retail CBDC is the same as holding physical money, and it will have a dedicated serial number just like a banknote. As it is issued by the central bank, it does not have the risk associated with other digital currencies. This means that people can use the Retail CBC in their digital wallet to make faster and easier payments. This new and easily accessible payment infrastructure is highly secure and can support innovation and new technology to increase efficiency. In addition, CBDC will allow the business sector to build on and develop products and services to prepare for the future digital economy transition.

Mr. Sayam Prasitsirigul, Krungsri Chief Information and Digital Officer said, "Krungsri is honored to be one of the first banks in Thailand to conduct the pilot test of Retail CBDC with the Bank of Thailand at the end of this year. This will be within a limited scale during the first phase, and it is an important and exciting step forward as we study the model for future development and expansion of its use. The plan for the Retail CBDC pilot test that Krungsri participates in is divided into 2 parts: the Foundation Track which will measure the system's efficiency and security and discover how to implement it with consumers in a real-world scenario; the Innovation Track, which focuses on how to develop new financial products to accommodate various needs of users and obtain feedback for the future development of the Retail CBDC.

"Retail CBDC is a widely popular topic among banks all over the world. It shows great potential since it is a digital currency issued by the central bank, meaning it is highly secure, easy to use, and it will not fluctuate. One CBDC is equal to one baht and can instantly be exchanged into cash. Also, CBDC allows new payment innovations such as Programmable Payment, which Krungsri believes will transform Thailand's financial landscape. Krungsri is ready to be one of the financial institutions to help Thais to learn about this digital currency if it is used for payments in the future."

Source: Spark Communications