The Bank of Thailand plans to collaborate with other regulatory agencies on setting up a co-regulatory sandbox to test digital identity verification through the National Digital ID (NDID) platform in the second half as part of efforts to further drive the digital economy.
The central bank has been in talks with the Electronic Transactions Development Agency (ETDA) and other regulatory bodies wanting to participate in digital identity authentication via facial recognition on the NDID platform and to expand NDID services and NDID use cases for the second phase covering corporate NDID.
The co-regulatory sandbox under the second phase of the NDID is expected to be set up in the second half this year, said Siritida Panomwon Na Ayudhya, the central bank's assistant governor for payment system policy and financial technology group.
The first phase of the NDID sandboxes covers only individual NDID users and each of them belonged to the Bank of Thailand and ETDA.
There are 94 organisations involved on the NDID platform, and 5.1 million customers registered with NDID.
The key use case of NDID service is the opening of new digital accounts for financial services and the use cases have been expanded.
As of February, bank deposit account openings through the digital identity verification on the NDID platform stood at 750,000 accounts.
There were also 8.1 million transactions of NDID use cases for personal credit checks with the National Credit Bureau to apply for loans.
The central bank set up regulatory sandboxes to test all new financial innovative products and services from 2016, covering standardised QR code payments, biometrics, blockchain and P2P lending platform.
There are a lot of related organisations testing in the regulatory sandboxes and 38 organisations have already exited them.
Ms Siritida said the central bank expects another 10 banks, which are testing in the blockchain sandbox in the use case of e-letters of guarantee, would exit from the sandboxes within June.
In addition, three business operators are testing on the P2P lending platform after one of them exited and received a business licence from the Finance Ministry.
The P2P lending provider has approved loans worth of 57 million baht to around 800 loan contracts.
Beside the regulatory sandboxes, the central bank also allows financial institutions to set up their own sandbox to test unique innovations of their organisations.
Ms Siritida said the central bank would continue implementing new guidelines for innovative financial products and services and set up new regulatory sandboxes to test related digital technologies.
The move would be in line with new technology and innovative financial service development covering virtual banks and digital assets as well.
The central bank needs to conclude the implementation and regulation of new businesses of both virtual banks and digital assets before implementing guidelines and regulatory sandboxes to test these businesses, she said.
The central bank's regulatory sandboxes testing for innovative financial products would give Thais access to financial services.
The digital financial services would provide more convenience, speed, security and reduce operating and financial costs.
It would also help to develop the country's overall digital banking and digital economy in the longer term.
