The Thailand card payments market will rebound by 2.1% in 2022 to reach THB1.7 trillion ($50.5 billion), as the economy is on the path to a gradual recovery from the COVID-19 pandemic, forecasts GlobalData, a leading data and analytics company.
According to GlobalData’s Payment Cards Analytics, the value of card payments in Thailand registered a decline of 11% in 2020, as the country was among the worst affected Southeast Asian countries by the pandemic, with its GDP contracting by 6.1% in 2020. With the country witnessing ‘third and fourth waves’ of the pandemic, the trend had not changed much in 2021, leading to a drop in card payments by 4.1%.
Ravi Sharma, Lead Banking and Payments Analyst at GlobalData, comments: “While cash remains the preferred mode of payments in Thailand, payment cards are also gaining prominence, supported by the rising banked population, government initiatives and expanding payment infrastructure. Card payments market was, however, adversely affected by the reduced consumer spending, particularly in the travel and tourism, and hospitality sectors during the pandemic. With the economic activities gaining pace, the card payments market is now on a recovery path.”
Being one of the popular tourist destinations in South Asia, Thailand was also badly impacted due to the pandemic. However, following the easing of the lockdown restrictions, companies (including those in the tourism and hospitality sectors) resumed business.
According to Thailand’s Ministry of Tourism and Sports, more than 1.3 million foreign tourists visited the country between January to May 2022, up from 35,000 during the same period last year. A recovery in these sectors will drive economic activities in the country, which, in turn, will support growth in card payments.
The Thai central bank is also taking steps to promote digital payments in the country. It launched Payment Systems Roadmap No.4 (2022-2024), which is a continuation of the previous Payment Systems Roadmap and National E-Payment Master Plan.
The new plan aims to further develop digital payments between 2022 and 2024. The key areas of focus in the new roadmap include creating an interoperable payment infrastructure, developing a biometric payment standard, developing a cross-border payment, and promoting the widespread usage of digital payments.
Sharma concludes: “The pandemic severely impacted the Thai card payments market. While the economic recovery and the opening of businesses are aiding a recovery in the card payments market, it is, however, not expected to reach its pre-COVID-19 levels anytime soon.”