New QR Code standard a paradigm shift . . .
Thailand is embracing the digital revolution and leveraging innovations in financial technology to become a ‘cashless society.’ The Thai government, through its National e-Payment Master Plan launched in 2017, has been promoting electronic payment methods such as QR codes to transition to a digital economy. QR (quick response) codes are a faster, cheaper, and easier payment option than cash or credit cards. The two dimensional square code allows customers to quickly scan to make consumer payments, as opposed to tapping, swiping, or signing a charge slip. The Thai Central Bank has now collaborated with major financial service providers to set up a Thai QR Code Payment Standard, with the aim to create an open, inter-operable payment infrastructure.
Bringing ASEAN into the fold . . .
As part of its broader e-payment road-map for 2020, Thailand will enable cross-border payments using standardized QR Code technology in ASEAN by mid-year. The aim is to set up a regional and inter-operable QR Code payment system to ease financial transactions and strengthen regional integration. The first wave of this digital integration will involve Thailand, Singapore, and Cambodia. The initial phase will focus on individuals and tourists in Thailand and Cambodia. After that, the service is expected to spread to other small and medium sized enterprises, particularly merchants and e-commerce businesses.
Impacts on a potential Canada-ASEAN FTA . . .
The QR Code initiative could be seen as a strategic move towards achieving the ASEAN Economic Community Blueprint (AEC Blueprint) 2025. The blueprint sets an ambitious plan for the region to foster innovation and enhance connectivity, strengthen ASEAN’s participation in global value chains, promote inclusivity and sustainability, and become a globally-competitive regional economic bloc. In 2019, at an ASEAN economic ministers meeting in Thailand, Canada and ASEAN concluded an exploratory discussion toward a free trade agreement (FTA). With Ottawa aiming to expand trade and investment within these large and fast-growing markets, the ASEAN fintech revolution provides a good entry point to kick-start that FTA.