Thailand
KBank fund transfers broad
Kasikornbank (KBank) has launched a cross-border fund transfer service for 13 Asian currencies, bilaterally, expecting to help customers save around 12 billion baht on foreign exchange this year.
Yesterday KBank claimed it is the first Thai bank to have a transfer service for the 10 Asean currencies and the yuan, yen and won, or the Asean Economic Community (AEC) +3 grouping.
The bilateral currencies settlement between the baht and the AEC+3 currencies helps customers save on transaction costs because it is a direct conversion without referencing the dollar, pound or euro.
Pattarapong Kanhasuwan, executive vice-president of KBank, said the move supports its plan to become a regional settlement bank for trade activities among the AEC+3 countries. The bank has worked with over 70 public and private organisations in AEC+3 and improved its settlement service capability in this region through digital technologies.
Total trade in this area is around 66 trillion baht per year, of which 20 trillion is intra-regional trade in Asean.
Asean member states agreed recently to promote trade settlement denominated by local currencies, replacing the dollar, pound and euro. As a result, local currencies have become more popular, particularly in trade settlement between Thailand and Asean, rising from 16% of total trade in 2012 to 22% in 2016. The ratio is expected to increase to 23% this year.
“Bilateral settlement between the baht and Asean currencies is expected to save the bank’s customers transaction costs of around 8 billion baht compared with using key global currency exchanges,” he said. “If intra-regional settlement rises to 23% of regional trade this year, it would help customers to save some 12 billion baht overall.”
KBank, the country’s fourth-largest lender by total assets, expects to see at least 280 billion baht in fund transfers using the new service this year, helping it to become a regional settlement bank in the near future. The bank has sought partnerships with regional financial institutions.
Source: http://www.bangkokpost.com/business/finance/1208021/kbank-fund-transfers-broad