The Thai government is taking steps to ensure the legality of its plan to borrow 172.3 billion baht from the Bank of Agriculture and Agricultural Cooperative (BAAC) to partially finance its 500-billion-baht digital wallet handout scheme. Prime Minister Srettha Thavisin has announced that the government will consult the Council of State for advice on the matter to ensure compliance with the law.
The digital wallet handout scheme, aimed at boosting the economy, will involve the distribution of 10,000 baht to every eligible individual. The funds will be accessible through a “super app” developed by the Digital Economy and Society Ministry and can be used across all banks.
Mr. Srettha emphasized the government’s commitment to transparency and public scrutiny throughout the implementation of the scheme. However, critics have raised concerns about the borrowing plan, drawing parallels to the previous rice-pledging program that resulted in significant debts.
In response, the government has assured the public that it will repay the BAAC loan. Deputy Finance Minister Julapun Amornvivat outlined the three sources of funding for the digital wallet scheme, which include allocating funds from the 2025 fiscal year budget, borrowing from the BAAC, and reallocating the current fiscal year’s budget.
While some critics argue that the handout scheme is a short-term measure driven by political motives, the government remains focused on its goal of revitalizing the economy. The scheme is expected to roll out in the fourth quarter, providing financial relief to millions of Thai citizens and potentially boosting GDP by 1.2 to 1.6 percentage points.
As the government seeks legal verification and addresses concerns raised by critics, it strives to ensure the successful implementation of the digital wallet handout scheme. With transparency and accountability at the forefront, the scheme aims to stimulate economic growth and provide immediate financial support to the people of Thailand.
Industry Overview
The digital wallet industry in Thailand has been growing rapidly in recent years. With the rise in smartphone usage and internet penetration in the country, digital payment solutions have become increasingly popular. According to a report by Research and Markets, the digital wallet market in Thailand is expected to grow at a CAGR of over 20% from 2021 to 2026.
Market Forecasts
The market for digital wallets in Thailand is expected to witness significant growth in the coming years. Factors such as the government’s push for digitalization, increasing consumer preference for contactless payments, and the convenience offered by digital wallets are driving the market expansion. By 2026, the market is projected to reach a value of several billion baht.
Issues and Challenges
While the digital wallet handout scheme aims to boost the economy and provide financial relief to citizens, there are concerns and challenges associated with its implementation. One of the main concerns raised by critics is the potential for misuse of funds and financial mismanagement, as seen in previous government initiatives such as the rice-pledging program. The government will need to ensure strict monitoring and transparency to address these concerns.
Another challenge is the need for widespread adoption of digital wallets. While Thailand has seen an increase in digital payment usage in recent years, there is still a significant portion of the population that relies on cash transactions. Educating and encouraging individuals to adopt digital wallets will be crucial for the success of the scheme.
Related Links
– Research and Markets
– Thai Law Forum
– Digital Today