SIAM, the largest commercial bank of Thailand, and PTTEP (PTT Exploration and Production Public Company Limited), the state oil company have successfully conducted a test for using blockchain for the purpose of cross-border payments for business-to-business transactions. The success of the pilot was recently announced by the bank on its website.
SIAM Commercial bank was established in 1907 by the Royal Charter and it is regarded as the first Thai bank. In its more than 110 years of banking experience, it has played a vital role in providing the needed financial services for Thailand. It is now a leading universal bank. It offers a wide array of products and services ranging from deposits and lending to offering overseas remittances, home loans, personal credit, ATM cards, car hire purchase, and debit cards. The services it offers for SME customers and corporates are corporate advisory, investment banking, international trade financing, treasury products, and debt and capital market products.
As per the news report, the project has been ongoing since mid-2018. As claimed by the bank, it has carried out blockchain payments in less than a minute, earlier this year. With this move, it aims to optimize operational efficiency.
As announced by Wasin Saiyawan, SCB Senior Executive Vice President and Chief Wholesale Banking Officer, “The service will be implemented in all CLMV and Southeast Asian countries by this year, which will serve as a major milestone in the development of cross-border payment services.”
PTTEP is based in Thailand and is engaged in the exploration and production of petroleum. It deals with three business segments namely overseas pipelines, oil and gas exploration and production, and investment in projects connected to the energy business. Its subsidiaries are PTTEP Siam Limited, PTTEP International Limited, PTTEP Offshore Investment Company Limited, and PTTEP MEA Limited. It operates in countries such as the Middle East, Africa, Australia, the United States, and Southeast Asia. Some of its projects are the Bangkok project, E5 project, PTTEP 1 project, B6/27 project, Arthit project.
The report also pointed out that using conventional methods usually requires a waiting time of one to two days for settlements to be carried out. SCB SEVP and chief wholesale banking officer Wasin Saiyawan said that the bank is now ready “to set a new norm for the industry.”
CrunchBase, the platform providing investments and funding information about private and public companies, has defined Siam Commercial Bank as the first ingenious bank of Thailand and states that as of 30 June 2016, it was the largest commercial bank of the country and estimated its annual revenue to be $2.9 million.
Sumrid Sumneing, the Executive Vice President of PTTEP Finance and Accounting Group, mentioned that the collaboration with SCB to use blockchain technology will be an ongoing process.
Recently, the head of digital market assets at Credit Suisse, Emmanuel Aidoo, has commented that as financiers hold a desire to maintain the status quo, they hold back from adopting blockchain technology.