(Bloomberg) -- Thailand said it will create a one-stop agency for integrated financial services to be more competitive in attracting foreign funds and investors, and will soon draft a law that will help position the country as a regional financial hub.
The new agency will issue licenses for banking, securities, insurance, digital assets and forward contracts for foreign companies, Deputy Finance Minister Paopoom Rojanasakul said at a briefing Friday. It will also deal with services for foreign businesses, such as work permits and tax incentives.
Bank of Thailand and Securities and Exchange Commission are currently responsible for oversight of most financial services, licensing and regulation, and the new agency is a way to “reform the supervision of financial businesses,” Paopoom said. Both those agencies have been in the spotlight, with central bank Governor Sethaput Suthiwartnarueput at odds with Prime Minister Srettha Thavisin over interest rates and fiscal policies, and the SEC trying to contain scandals related to publicly traded Stark Corp Pcl and Energy Absolute Pcl.
Thailand needs to improve its regulatory and legal ecosystems to achieve the goal of becoming a regional financial hub, Paopoom said.
“One-stop service, clarity in capital management are the key to Thailand growing into the financial frontier of the region, attracting capital, knowledgeable people to come to the country, creating benefits for the world economy,” the government said in a statement.
Srettha, who has prioritized drawing foreign investments since taking over less than a year ago, said positioning Thailand as a hub will help attract not only funds but also qualified workers. A one-stop center will benefit banks, investments, securities and virtual banks, spurring activities such as consultancies for legal, technology, investment services in the process.
“The plan will change our economic growth structure to high-value services sector from manufacturing without using state budget,” Srettha said.
As part of the efforts to improve the local financial landscape and banking access, the government will soon grant licenses for virtual banks, Paopoom said.
Although the second largest economy in Southeast Asia, Thailand’s largest publicly traded bank, SCB X Pcl, ranks 15th among its Southeast Asian peers by market value. Singapore, Indonesia, Malaysia, Vietnam and Philippines all have bigger firms than SCB’s $9.5 billion capitalization.
Srettha’s government plans to set up the National Credit Guarantee Agency to improve loan access to small and medium enterprises within a year, Paopoom said.
--With assistance from Pathom Sangwongwanich.
(Updates with details on credit agency in final paragraph. An earlier version of the story was corrected to show government will hand out virtual bank licenses.)
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