Thai Bankers' Association studies methods to outsource white-label ATMs
The Thai Bankers' Association (TBA) plans to allow a third party to manage white-label ATM operations, a pool ATM service run by non-bank firms instead of individual banks, to cut the banking system's operating costs.
National ITMX, an interbank transaction management and exchange service provider under the TBA, has decided on a white-label ATM model study and proposed a third party take over machine management under the two options, said TBA chairman Predee Daochai.
Under the first alternative, all ATMs will be sold to a vendor hired to manage the machines. The second option sees commercial banks own ATMs, but employ a third party to run the operations.
Commercial banks will pay a fee to the third party and receive income under a profit-sharing concept, regardless of the option chosen, he said.
Kasikornbank (KBank) and Government Savings Bank (GSB) recently jointly launched a pilot project for white-label ATMs, with no withdrawal fees and unlimited withdrawals with some conditions.
Under this collaboration, customers of KBank and GSB can make withdrawals, seek deposit information and conduct interbank money transfers using both KBank and GSB bank accounts. Transactions are free if conducted in the same province.
For more than four interbank money transfers to different provinces, there is no cash withdrawal fee for KBank customers, while GSB customers are charged 15 baht per transaction.
The project, which is slated to end on April 30, 2020, is being tested in five provinces: Sakon Nakhon, Nakhon Phanom, Pattani, Yala and Narathiwat.
Mr Predee said they are deciding on which model to apply.
The white-label ATMs should lower operating expenses for the banking industry if applied on a large scale, he said.
"White-label ATMs are possible in Thailand, despite the slow growth of ATM transactions against a backdrop of strong growth in digital banking. ATMs are still crucial for some customer segments, so banks should have multiple channels to keep pace with consumer needs," said Mr Predee.
He said the TBA's new business plan, which will replace the five-year plan running through June next year, will maintain six key tasks comprising digitisation and next-generation payment infrastructure, financial inclusion and the supporting economy, contributions to society, preparing for the Asean Economic Corridor, legal and regulatory issues and human capital development.
For digitisation, TBA wants to expand cross-border payments. Under the Asean banking collaboration, TBA plans to connect Thailand's e-payment platform, PromptPay, with that of Singapore, PayNow.