The popularity of the PromptPay service will lead e-payment gateways to reduce their fees and launch new services, says a local e-payment gateway pioneer.
"Banks are making an aggressive approach on payment gateways as more merchants use PromptPay because of free transfer fees and accept quick response (QR) code payment, developments that challenge e-payment gateway operators," said Pawoot Pongvitayapanu, chief executive of Pay Solutions Co, a local payment gateway provider.
According to Bank of Thailand statistics, the highest volume of payment comes from e-payments, compared with other methods of payment such as cheques, ATMs, counter service, internet and mobile.
As of Nov 30, 2017, e-payment volume reached 330 million transactions, up from 302 million transactions in January 2017.
Moreover, intense competition is coming from new players such as BluePay and AirPay.
E-payment provider Paysbuy was a dominant player until its acquisition by Omise in July 2017. To cash in on the thousands of merchants connected to Paysbuy's payment gateway, Omise has waived the transaction fees for the first 20,000 baht the merchants spend during the first six months.
Pay Solutions is also eyeing a share of Paysbuy traders.
"We hope to attract 10-20% of Paysbuy's merchants to connect with Pay Solutions," Mr Pawoot said.
Pay Solutions has developed its gateway to support Alipay by connecting with the authorised partner of Alipay in Thailand, which allows local merchants using its gateway to accept Alipay payment. This is particularly useful for Chinese tourists who need to book accommodation or make purchases in Thailand.
The intense competition has also driven down the payment gateway fee to 3.5-3.6% from more than 4.7%.
Mr Pawoot said the company will also enable its system to accept QR code payment to further help its merchants.
The growth of e-payment mainly came from online-based services including food ordering, booking or reservation and online shopping.
"Our uniqueness is that we accept every payment method, including instalments, and integrate with social media pages for social commerce," he said.
Piyachart Ratanaprasartporn, chief executive of 2C2P Pte, a Southeast Asia payment service provider, said PromptPay and QR code payment will be important tools to drive e-payment in Thailand. They provide a fast and easy user experience for buyers and low charges for merchants, benefits that are bound to attract more people to adopt the schemes.
Moreover, smartphone players like Samsung and Apple also promote mobile payment.
E-payment is now pretty much borderless, he said, and a successful payment provider is one that provides many payment choices to merchants to expand their coverage, not just locally but across Southeast Asia.
"Online merchants will be consolidated and acquired by big corporations and expand regionally or globally, so payment needs to be cross-border too," said Mr Piyachart.