The pandemic has pushed Superrich Thailand Forex (STR Forex) to think of new ways to do business in order to survive.
"It is difficult to plan for long-term business. There needs to be a focus on the short term, on a quarter-by-quarter basis." — Sittharmanin Susamawathanakun, Managing Director, Superrich Thailand Forex
Managing director Sittharmanin Susamawathanakun said STR Forex, which is better known by its marketing brand name Superrich Green, has been focusing on its new business of cross-border money transfers after receiving two business licences and an e-money and money transfer agent certification from the Bank of Thailand last year.
The company has been exploring the investment advisory business together with digitisation efforts while searching for new business partners.
"The move is the result of the virus crisis. Since the outbreak began in Thailand in March 2020, the company's foreign exchange business in terms of transaction numbers and volume has decreased by 90% from the pre-Covid period," she said.
Prior to the outbreak, the company handled around 100,000 forex transactions per month.
According to Ms Sittharmanin, the money-changing industry has been damaged almost as much as the tourism sector because of the close links between both businesses.
Some money-change operators, particularly forex booths located in southern tourist attractions, have permanently closed and returned their business licences to the central bank, she said.
Bleak prospects
"Local customers who switched to baht from foreign currencies were a major source of income and our core customers, but these transactions plunged as of March 2020 because of international travel bans," said Ms Sittharmanin.
"However, another business opportunity arose. Since February this year, some Thai expats have started returning home for vacation, creating demand for foreign currencies as they switch to baht.
"Amid an uncertain economic outlook, cross-border travel bans, insufficient vaccine supply, and a fresh surge of new infections this month, it is difficult to plan for long-term business. There needs to be a focus on the short term, on a quarter-by-quarter basis."
New opportunities
The company previously planned to launch a cross-border money transfer business in the first quarter this year, but was derailed because of the regulatory time frame.
Superrich Green now expects to unveil the service in April or May, once the company's internal system is ready.
In the initial stage, an international remittance service is scheduled to be available at 14 physical networks of Superrich Green, largely located in shopping malls.
By the fourth quarter this year, the service is expected to be available via mobile app.
Ms Sittharmanin said STR Forex and its business partners have developed a digital infrastructure to keep abreast of consumers' changing lifestyles in the digital era, especially after the pandemic.
She acknowledged tough competition in the sector from existing players such as commercial banks and non-bank institutions.
New players are joining the fray, but STR Forex has a strong customer base and positive demand for cross-border money transfers, said Ms Sittharmanin.
Roughly 20-30% of the company's existing clients have requested cross-border money transfers, so there is demand, she said.
Demand supports advisory
The company is also exploring investment advisory in response to customer requirements. Entrepreneurial clients want more information and services than merely forex transactions, said Ms Sittharmanin.
For instance, these clients want to know about forex rates for several currencies compared with the baht, and money and capital market trends as well as investment opportunities.
Superrich Green trained its staff through re-skilling and up-skilling programmes to answer such questions.
The partnership model is a key strategy for this new business. SRT Forex plans to act as an advisory agent for investments while collaborating with partners experienced in fund management as well as tech companies to build a suitable ecosystem, she said.
The company has not finalised a business plan yet, but expects a clearer picture by the final quarter this year, Ms Sittharmanin said.
Speeding up digitisation
She acknowledged the company has been quite slow to develop digital solutions, even though this is an important requirement.
Previously the company focused mainly on existing business operations that contribute to transaction volume, leading to growth.
"Before Covid-19, there were a lot of transactions on hand and dealing with daily workload was a priority," said Ms Sittharmanin.
"However, the outbreak came and changed everything. Despite the delay in going digital, we're running in that direction now."
STR Forex made digital payments available via mobile banking, QR code and credit card for forex transactions as of last year.
Digital payments represent around 10% of total forex transactions now and are showing a positive trend, she said.
The company also launched a mobile app, SuperRichTH, in December 2020, offering forex transactions on the digital platform and providing related information.
The app is expected to support its upcoming investment advisory service.
Lean and profitable
Driven by the heavy impact of the pandemic, the company restructured its internal business operations, especially through operational expense control.
Last year the company closed two of its underperforming branches, leaving a total of 14 outlets operational.
STR Forex also implemented a voluntary early retirement programme and cut around 35% of its total employee numbers.
If the forex business were to normalise, the company has no plan to open more brick-and-mortar branches, said Ms Sittharmanin.
Any expansion would rather be in the form of movable pop-up outlets located in community areas for the short term before moving on to other locations. Such a model is more flexible and better responds to customers' varying requirements, she said.
"With a lean organisation and offering new businesses, we expect to book a profit this year, albeit an insignificant amount," said Ms Sittharmanin.