BAY studying digital token deposit service
Bank’s innovation head says SEC rules for transactions need consideration before moving forward
Bank of Ayudhya, the country’s fifth-largest lender by assets, is considering a deposit account service for digital token trading that would position BAY as a payment gateway for digital asset transactions.
But the bank still needs to study Securities and Exchange Commission (SEC) rules governing digital asset transactions, said Thakorn Piyapan, the bank’s head of digital banking and innovation.
Moreover, BAY will need to adjust internal business operators and adopt Electronic Know Your Customer standards for security purposes if it wants to roll out the deposit account service for virtual coin trading, Mr Thakorn said, without specifying a time frame.
Savings accounts at Siam Commercial Bank, Bangkok Bank, Kasikornbank and Krungthai Bank were reportedly used for payments related to digital coin transactions.
Mr Thakorn said deposit account service will provide customer convenience in digital asset trading.
The Bank of Thailand said recently that it does not prohibit or set out any requirements for financial institutions to offer savings account or lending services to operators engaged in digital assets.
The regulator has asked financial institutions to refrain from issuing, investing, providing exchange channels and being brokers for digital tokens, and avoid advising consumers on investing in digital assets as this new asset class is in the early stages of development and no party can clearly assess and manage risks.
Financial institution subsidiaries that are supervised by specific regulators, including securities and asset management companies, and life and non-life insurers, can be involved in trading or do business related to digital assets, but they must comply with regulators’ requirements gain approval as stipulated in the royal decree on digital assets.
For other subsidiaries, parent financial institutions are required to seek central bank approval on a case-by-case basis if they want to make transactions or engage in digital assets, which are beyond the scope approved by the Bank of Thailand.
Financial institutions should also bar customers from using credit cards to trade digital assets as such investments carry high risks than could deteriorate debt-servicing ability and the country’s household debt problem, the central bank said.
If financial institutions plan to issue or invest in digital assets to develop financial innovations and increasing efficiency, tests must be carried out in the Bank of Thailand’s regulatory sandbox, except where there are regulations to oversee risks and protect consumers.
BAY shares closed yesterday on the SET at 41.75 baht, up 25 satang, in trade worth 25.8 million baht.