About Thailand

Thailand is an emerging economy which is heavily export-dependent, with exports accounting for more than two-thirds of GDP. Thailand is the second largest economy in Southeast Asia and ranks high in exports in the automotive industry, as well as in the manufacturing of electronic goods. Currently, the manufacture of technological products and vehicles are driving Thailand's strong growth in exports although the country's economy is mainly in production.

Government reforms have improved regulatory efficiency in recent years. Labour regulations are relatively flexible and property rights are generally applied effectively.

Major cities in Thailand have well-established infrastructures, enhancing Thailand's profile as an attractive destination for investment, supported by a cheap labour force and a relatively large pool of English speakers.

The government's pro-investment agenda, which includes the second lowest corporate income tax in ASEAN and policies with emphasis on liberalisation and free trade, have let to further increase in investment in Thailand.

Thailand is also geographically located in the middle of Southeast Asia, and has an extensive road network connecting to other countries, including China. Its intention is to increase accessibility to Asia to support its trade sector.


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Corporate Treasury in Thailand

Thailand is the second-largest economy in Southeast Asia and a newly industrialised country. Its economy is heavily export-dependent. Here, we highlight some of the key benefits relevant to treasury and cash management in Thailand. 


Financial market development:

  • The World Economic Forum ranks Thailand 39th in the world for financial market development in The Global Competitiveness Report 2015-2016.
  • It ranks Thailand 31st in the world for the soundness of its banks, while it rates the country reasonably highly for ease of access to loans and financing through equity markets and 3rd for legal rights.
  • Thailand has good business infrastructure, an efficient workforce and a strong legal environment. The government is pro-business, although there is some political instability.
  • Thailand has foreign-exchange controls. There are no restrictions on the import of foreign currency but it must be exchanged into Thai baht or deposited in a foreign currency account with an authorized bank within seven days. Proceeds of more than USD50,000 from exports and certain other transactions must be repatriated within 360 days from the date of the export and immediately after receipt of payment.


Sophistication of banking systems:

  • There are 14 commercial banks in Thailand, and 15 foreign-owned banks. A further 48 banks have representative offices in Thailand.
  • Thailand's foreign-exchange market has an average daily turnover of USD11 billion, accounting for 0.2% of global turnover (Bank for International Settlements triennial global survey 2016).
  • Thailand's debt market has both government and corporate bonds available, although it is dominated by government bonds. The local currency bond market had a total value of THB10,856 billion at the end of December 2016.


Regulatory bodies:

  • The banking industry is regulated by the central bank the Bank of Thailand. Regulations are in line with international standards. Foreign-exchange controls are also overseen by the Bank of Thailand.



  • The Corporate Income Tax rate is 20%. Petroleum companies are taxed at 50% on their profits from petroleum operations.
  • Resident companies are taxed on worldwide income. Foreign companies are taxed on profits derived from Thailand. Foreign companies that do not do business in Thailand are subject to withholding tax on certain income.
  • Branch profits remitted to a foreign head office are subject to an additional tax charged at 10%.
  • The standard rate of VAT is 10, but it is reduced to 7% until 30 September 2017. A number of goods and services are VAT-exempt.
  • Stamp duty is levied on 28 different types of documents, including work contracts, loans and share transfers. Rates start at THB1 per THB1,000 of the value of the contract.
  • Specific business tax is collected at fixed rates on revenue from certain businesses that are not subject to VAT, such as banking and similar financial businesses. Rates range from 0.01% to 3%.
  • Interest income is subject to CIT. Interest expenses are deductible.
  • For resident companies withholding tax on dividends is 0% or 10%, and 0% or 1% on interest. For non-resident companies where there is no treaty it is charged at 10% on dividends and 15% on interest. Where a treaty is in place WHT is charged at 5% or 10% on dividends and at 0%, 3%, 10% or 15% on interest.
  • Thailand has tax incentives for certain activities in agricultural, mining, light industry, metal products, the electronic industry, chemicals, services and public utilities, such as a CIT exemption for up to 8 years. There are also tax incentives for companies operating in certain provinces.
  • Companies that use Thailand as a regional operating headquarters or international headquarters may qualify for tax incentives, including a 10% income tax rate on profit from certain activities provided to domestic affiliates, or a full CIT exemption on profit from certain services carried out by an international headquarters for foreign affiliates, and withholding tax exemptions.
  • Tax concessions for approved treasury centres include exemption from specific business tax on money received from financial management services provided to affiliates, withholding tax exemption on interest under certain circumstances, a full CIT exemption on profit from certain services provided to foreign affiliates, and a 10% income tax rate on profit from certain activities provided to domestic affiliates.
  • Thailand has tax treaties with more than 60 countries and territories.


Benefits for Regional Treasury Centres and Operations:

  • There are tax concessions for regional treasury centres and regional operating headquarters, including exemption from specific business tax on money received from financial management services provided to affiliates, WHT exemption on interest under certain circumstances, a full CIT exemption on profit from certain services provided to foreign affiliates, and a 10% income tax rate on profit from certain activities provided to domestic affiliates..
  • Thailand is a popular location for shared services centres due to its large, cost-effective labour pool and supportive government policies.
  • Thailand is a member of the Asian Payment Network, a common payment-settlement platform within the Asia-Pacific region.
  • Cash concentration is available for residents but foreign-exchange controls make it difficult for non-residents to participate.
  • Notional pooling is available, although the tax treatment is unclear. Cross-border notional pooling is not available.
  • Cross-border cash pooling is permitted with a Treasury Centre License from the Bank of Thailand.




Banking System

  • Thailand has 14 domestic commercial banks and 11 foreign bank branches. In addition, there are four foreign bank subsidiaries and 48 foreign bank representative offices.
  • Commercial banks represented 74.6% of the banking industry.
  • There are four banks that dominate Thailand’s banking sector: Siam Commercial Bank, Bangkok Bank, Kasikorn Bank and Krung Thai Bank. Together, they make up approximately 69.5% of the banking industry’s total assets.
  • Bangkok Bank is Thailand’s leading commercial bank, with the largest network of branches and retail customer base.  It is also one of the leading regional banks in South-east Asia.


Bank Accounts

  • Residents: May hold domestic currency (THB) accounts domestically and overseas, with prior approval from the Bank of Thailand (BoT) for overseas accounts which are convertible to foreign currency accounts used for specific financial purposes. May also hold foreign currency accounts domestically and overseas.  
  • Resident institutional investors: May hold foreign-exchange accounts overseas on condition they are used for investment in securities, with no upper limit on funds. Funds may be repatriated freely.
  • Non-residents: May hold domestic and foreign currency accounts. Domestic currency accounts have a maximum outstanding daily amount of THB 300 million; funds cannot be transferred between different accounts and are not convertible into foreign currency.
  • Interest: Only available to savings accounts.


Legal and Regulatory

  • The BoT is an autonomous institution and it oversees Thailand’s banking sector, including foreign-exchange transactions and bank reporting through the International Transactions Reporting System (ITRS).
  • As of March 2016, Malaysia and Thailand established a bilateral agreement regarding local currency exchange (THB and MYR) allowing import/export trade accounts to be settled more efficiently between the two countries.
  • Thailand is a member of the Association of Southeast Asian Nations (ASEAN).
  • Under the ASEAN Banking Integration Framework, the BoT signed agreements with Malaysia and the Philippines’ central banks, which ensures banking legislations with these two countries.
  • Thailand has anti-money laundering and counterterrorism financing legislation in place.
  • It has a financial intelligence unit, the Anti-Money Laundering Office, which is a member of the Egmont Group and is a unit of the Department of Justice.




Payment Systems


(BoT Automated High-Value Transfer Network)

Thailand's national Real-time Gross Settlement (RTGS) system

  • Owned and operated by the BoT.
  • Provides delivery versus payment settlement (DVP) for Thai government securities.
  • 68 participants.
  • Processes high-value and urgent THB-denominated interbank transfers.
  • Processes the final settlement of participants' net balances that originate from Thailand's other clearing houses.
  • Settles and finalises transactions in real time.
  • Final settlement is across participant banks' correspondent accounts at the BoT.

Bulk Payment System

Deferred net settlement system for electronic credit and debits

  • Operated by the National Transaction Management and Exchange (ITMX) company.
  • It is divided into two subsystems: the Direct Credit service and the SMART Credit service.
  • 37 direct participants.
  • Processes electronic credit and debit transfers of up to THB 2 million.
  • Final settlement is done through BAHTNET on a net settlement basis. Funds are available to beneficiaries same day.


(Imaged Cheque Clearing and Archive System)


Cheque and paper-based payments clearing system

  • Truncates cheques and paper-based payments and processes them electronically same day through BoT's Electronic Clearing House (ECH) by online-participant banks.
  • 39 participants.
  • ECH processes the cheque images and related data and then forwards them for approval by the paying bank.
  • Processes for same-day clearing through ICAS whereby funds are available to beneficiaries from 12:00 the same day.


Payment Instruments


Credit transfers:

  • High-value and urgent interbank transfers cleared and settled through BAHTNET in real time.
  • Low-value, non-urgent and high-volume credit transfers done through the SMART Credit service.
  • Low-value credit transfers are usually used for payroll, supplier and third-party payments.


Direct debits (autodebits):

  • Used for low-value, regular payments such as utility bills.
  • Also used for high-value debit transfers that are cleared and settled through BAHTNET real time.
  • Low-value direct debits settled through Bulk Payment System's Debit next Day (DD3) service.



  • Common form of cashless payment.
  • Used for retail and commercial payments.
  • Truncated and processed same day through ICAS.


Card payments:

  • Becoming increasingly popular form of cashless payment.
  • Visa and MasterCard are the main payment cards, although there are plenty of other cards available.
  • As of February 2016, Thai Payment Network (TPN) and UnionPay International established a local network for processing electronic card payments.
  • There are 63,432 ATMs and 357,986 (2015) POS terminals.
  • The National ITMX shared system is the country's ATM network and clearing system.
  • Reloadable, prepaid cards are available for electronic payments.




Recent developments


PromptPay Explores PayNow Tie-up

The Bank of Thailand is holding talks to connect PromptPay with Singapore’s PayNow to enable users in both countries to transfer money to each other using their mobile phone numbers. PromptPay is part of Thailand’s e-payment initiative, which is designed to help the country become a cashless society. It offers a cheap fund transfer service using mobile phone numbers or citizen ID numbers. There have been 97 million PromptPay transactions since it was first launched last year.

Read more about the development here.


Blockchain Banking Initiative Launched

Fourteen Thai banks have joined forces with four large businesses and three state-owned enterprises to launch an initiative offering blockchain-based letters of guarantee. Letters of guarantee with an estimated value of THB1.35 trillion were issued by banks in 2017, but only 15% to 20% of these were done electronically. It is hoped that by making the system blockchain-based, the service will be more secure, reliable and efficient, while operating costs could be reduced by 50%.

Read more about the development here


New Digital ID Project

The government has launched a national digital ID project to facilitate electronic transactions. The system can be used to verify the identity of individuals and corporations using online services offered by both the public and private sectors. It aims to reduce the complexity of online transactions, while also increasing their speed, security and convenience. It will initially be used by government units and corporations that share information, such as the Revenue Department and insurance companies.

Read more about the development here.



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Sources: IMF World Economic Outlook database, October 2016; CIA World Factbook; Trading Economics; PwC

Please note that the information contained in this document, assembled based on information available and accurate as at July 2017, is of a general nature only and is subject to change whether for economic, political, social or other reasons.


Last updated on 20 May 2018