DPA pursues BoT nod to process e-wallet refunds

DPA pursues BoT nod to process e-wallet refunds

The Deposit Protection Agency (DPA) is seeking the Bank of Thailand's permission to get involved in the money refund process from e-wallet operators with an aim of facilitating convenience for service users.

The agency discussed the service with the central bank, with consumer convenience to get money back from e-wallet operators as its focus, said president Songpol Chevapanyaroj.

For the refund service, e-wallet operators must be allowed to be DPA members, he said.

According to the central bank's regulations, e-wallet business operators are restricted to using money parked in the digital wallet for consumer payments, and this already ensures that money in the e-wallet is fully protected.

Money refunded to consumers remains a pain point, given that the process is complicated and consumers need to show up at e-wallet operator offices to request refunds.

"In the event of a bank collapse, the DPA can direct money back to depositors within 30 days through the country's national e-payment platform PromptPay," Mr Songpol said. "This practice can also be applied to e-wallets."

The DPA, set up after the 1997 financial crisis, provides protection for deposits at commercial banks, which in turn contribute 0.01% of the banks' deposit base each year to the agency.

The agency will conduct a feasibility study for the project and study consumer benefits, then submit both results to the central bank, Mr Songpol said, adding that the study is expected to take about one year and the service is subject to approval by the Finance Ministry, which supervises the DPA.

Allowing e-wallet operators to be DPA members would benefit consumers by ensuring money protection and refund convenience. E-money is classified as a product that is close to deposits offered by both banks and non-bank companies but is not under DPA protection.

E-money is a type of financial service and involves many people. The business has grown significantly in terms of users, transaction volume and numbers. The ticket size of money in e-wallets has grow significantly.

The business has high potential to grow in line with changing consumer behaviour in the digital age and is more accessible than banks' deposit accounts.

For the first quarter, e-wallet top-ups soared 66.7% from last year to 69.3 billion baht, while payment volume leapt 71.8% to 67.2 billion baht.

Mr Songpol said depositors would not be affected by a reduction in deposit guarantees to 5 million baht from 10 million per depositor per bank, starting on Aug 11 this year.

Depositors with up to 5 million baht in bank accounts represent the country's largest portion at 99% of total depositors.

The impact will be insignificant when the deposit protection is reduced to 1 million baht on Aug 11 next year, as people with deposits of up to 1 million baht account for 98% of total depositors.

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