AIMING TO become a regional settlement bank, Kasikornbank has introduced a funds-transfer service for all AEC+3 currencies at every branch, embracing fast-growing border trade denominated in local currencies.
KBank said the move would not only cut customers’ transaction costs, but also give them opportunities to seek new partners. As Thailand’s first bank to offer the service for all AEC+3 currencies, KBank expects at least Bt280 billion in funds transfers under this service for the year.
According to Silawat Santivisat, executive vice president, KBank plans to be a regional settlement bank supporting trade between the Asean Economic Community and three large neighbouring markets, namely China, Japan and South Korea, totalling Bt66 trillion per annum, plus the Bt20-trillion intra-regional trade of Asean. To this end, AEC+3 has seen significant expansion as one of the world’s economic powers.
Pattarapong Kanhasuwan, another KBank executive vice president, said Asean member states had agreed recently to promote trade settlement denominated in local cur?rencies, replacing major global currencies – such as the US dollar, pound sterling and the euro – which have been largely used among regional trade partners.
As a result, local currencies have become more popular, particularly in trade settlement between Thailand and Asean, which soared steadily over the past five years from 16 per cent of total trade in 2012 to 22 per cent in 2016.
Silawat added that given strong demand from Thai customers, KBank, equipped with branches and allies in all AEC+3 countries, had turned out to be the first bank in Thailand to offer services for funds transfer and trade settlement denominated in AEC+3 currencies.
Through its international trade service centres and branches located in the same time zone, related facilities and convenience will be offered to AEC+3 business operators with speedier transactions.
By reducing currency exchanges, their transaction costs will be decreased, while their trade opportunities with new local partners will be enhanced, as many operators in this economic bloc prefer local currencies in trade, the bank said.
KBank expects to see at least Bt280 billion in funds transfer under the new service for the year, with year-on-year growth of 11 per cent.
Pattarapong revealed that in its efforts to turn into a regional settlement bank, KBank had teamed with more than 70 public and private organisations in AEC+3 and improved its settlement service capability especially for this region, plus the three neighbouring markets.
Digital technologies have been employed in advancing international settlement channels, so that customers can enjoy accurate, swift and secure services, the bank said.
It said global remittance could also be made through K-Mobile Banking Plus as an alternative channel for fast and convenient customer service, offering “anywhere, any time” transactions that slash operating costs with greater customer access through KBank’s partners.
For instance, it added, a Thai operator may directly conduct outward remittance to a trade partner’s account with Wing (Cambodia) Limited Specialised Bank.