Siam Commercial Bank Launches Stablecoin Remittance Services
Siam Commercial Bank of Thailand is going all the way into the digital financial world. In partnership with Bangkok-based fintech company Lightnet, SCB has launched stablecoin remittance services, thereby allowing customers to perform cross-border payouts and receipts in an efficient manner and at significantly friendlier transaction fees.
24/7 Cross-Border Payments
The new stablecoin service will be operating 24/7 for the non-stop availability of cross-border transactions. This gives, in particular, a competitive advantage to users who send remittances from stronger currencies into regions whose local currencies may be more volatile. Because it is based on stablecoins, this means much more stable and cost-efficient transfers.
Financial Inclusion and Lower Costs
Tridbodi Arunanondchai, the CEO of Lightnet, emphasized that the new service is inclusive. He added that this project reduces the capital need per transaction and thus benefits individual clients in addition to its retail, corporate, and institutional customers: “With this project, the card-issuing bank will perform background checks on the account holder and then issue cards to those who have passed their KYC tests. Those cardholders would be able to withdraw Thai Baht from any ATM using our platform.”
These low fees for transactions using stablecoins make the stablecoin a particularly attractive vehicle for cross-border settlements, particularly in countries where remittances are a key driver of income.
Tested in Thailand’s Regulatory Sandbox
It was first piloted in the regulatory sandbox of the Bank of Thailand, which allowed SCB to test digital asset services without necessarily immediately having to grapple with the regulatory challenges. The test run in this sandbox will be an important milestone toward wider dissemination of stablecoins into Thailand’s financial ecosystem.
Stablecoins and Developing Countries
In developing nations, especially where local virtual currencies are highly devalued, stablecoins have started to gain popularity as a store of value. Stablecoins, for instance, make up about 43% of all cryptocurrency transactions in Sub-Saharan Africa. Similarly, in the Latin American nation of Venezuela, more than 50% of its remittances involve stablecoins.
Stablecoins Catalyzing the Development of Digital Economy
According to Mastercard’s report in March 2024, remittances in South America grew faster than in any other region around the world. “Stablecoins will continue to grow in market share and drive the world toward a more digital economy,” the report said.
