Krungthai Bank, a prominent commercial bank in Thailand, has successfully undergone a remarkable digital transformation, positioning itself as a leading force in the country’s digital banking landscape. Through the strategic utilization of technology and innovation, Krungthai Bank has seized opportunities amidst the crisis posed by digital disruption and the Covid-19 pandemic, experiencing rapid growth and solidifying its position as a trailblazer.
This achievement can be attributed to the forward-thinking vision and clear strategic directions of Payong Srivanich, the President and CEO of Krungthai Bank. With his exceptional leadership, Payong earned the esteemed title of “Best Banking CEO of the Year Thailand 2023.” He employs the “Courage to Change” approach while focusing on the five key ecosystems that are highly relevant to the lives of Thai people. They are government agencies, payments, healthcare and wellness, education, and mass transit. By fostering financial innovation and establishing interconnected financial services within these ecosystems, Krungthai Bank adeptly responds to customer demands while expanding its business horizons.
Payong is spearheading the bank with the 2-banking-model strategy, wherein the bank simultaneously fortifies and enhances its traditional banking operations using the “carrier” model while propelling new business ventures using the “speedboat” model. The speedboat fosters fresh growth opportunities and cultivates strategic partnerships with both public and private sectors to develop cutting-edge financial innovations tailored to the ever-evolving needs of customers, delivering services through both online and offline channels, with notable success achieved through the Paotang mobile application. Regarded as Thailand’s open digital platform, Paotang has proven highly effective, particularly as a means for the government to address economic challenges and distribute vital financial aid in a transparent and equitable manner, thus contributing to the reduction of social inequality. Furthermore, the application has facilitated access to health benefits and Covid-19 vaccinations for individuals while revolutionizing Thailand’s investment landscape through the introduction of digital government savings bonds, digital corporate bonds, and the Gold Wallet for gold investment. The Paotang application has been instrumental in familiarizing Thai people with digital payments in their daily lives, and its exceptional performance has led to it being recognized as a “Super App,” attracting over 40 million users in just three and a half years—equivalent to nearly two-thirds of the country’s population—earning acclaim at national, regional, and global levels.
The Thai banking industry is set to encounter numerous challenges while adapting to the new financial landscape introduced by the Bank of Thailand, marked by openness in three key aspects: open infrastructure, open data, and open competition. The open infrastructure entails establishing an infrastructure that provides a level playing field for both incumbents and new players. Open data focuses on facilitating data sharing to encourage the development of innovative products and services. Furthermore, the industry will face the challenge of open competition, which blurs the line between banks and non-bank financial institutions, welcoming new players into the market.
As the CEO of Krungthai Bank, Payong Srivanich is skillfully navigating through these transformative changes and challenges while positioning the bank for future opportunities. Under the banner of “Accelerating Sustainable Value Creation,” he has devised seven core strategies to strengthen the bank’s foundation, modernize its traditional banking operations, and expedite growth efficiently. Simultaneously, the bank is developing new business models to cater to the evolving needs of customers and partners who are transitioning to the digital economy, while ensuring decent and sustainable returns for shareholders. The seven strategies are outlined as follows:
- Unlock disproportionate value from X2G2X: This approach involves expanding the bank’s customer base by connecting customers and their partners through digital platforms. By forging deep connections across various sectors, the bank facilitates transactions such as B2B, B2C, G2B, and G2C, addressing the diverse needs of its customers. For instance, the bank aims to generate economic value from platforms like Paotang and Tung-ngern, which have garnered a significant user base through their use in government financial aid programs. Additionally, the bank strives to empower SMEs and support their growth and development with appropriate risk management measures.
- Leverage digital and data to drive efficiency: Krungthai Bank is committed to accelerating the utilization of data and technology to enhance operational efficiency, while diligently adhering to personal data protection regulations and standards. This ensures that all customers can trust in the bank’s commitment to data security and privacy.
- Launch new growth platforms: The bank endeavors to meet all customer needs through the introduction of new platforms. For instance, it is actively collaborating with a partner to develop a virtual banking platform. It is also developing a Wealth-Tech platform that enables inclusive access to finance and financial services.
- Support sustainable and inclusive growth: Krungthai Bank places Environmental, Social, and Governance (ESG) principles at the core of its business practices. The bank aims to extend its reach to grassroots communities, assisting SMEs in transitioning to the digital economy and New S-Curve industries. These initiatives contribute to the sustainable development of the Thai economy.
- Build future-ready capabilities: The bank is focused on enhancing risk management capabilities and ensuring compliance with the Personal Data Protection Act. It also aims to develop cyber-risk-proof systems to instill customer confidence. Leveraging digital marketing and data analysis, Krungthai Bank seeks to better understand customers and eventually offer personalized banking solutions. Additionally, it aims to enhance the competitive advantages of its affiliates.
- Upgrade core technology infrastructure: Krungthai Bank recognizes the importance of maintaining an up-to-date, secure, safe, and stable core technology infrastructure to accommodate the growing number of users in the future.
- Transform culture—embed new ways of working to drive organizational agility: Embracing a “Courage to Change” mindset, the bank’s employees adapt to ongoing transformations and adopt an agile approach to work. This ensures the bank gains a competitive edge over its competitors. Employees will undergo reskilling and upskilling to create a future-proof workforce. Furthermore, the bank strives to attract and retain top talent, creating a model organization that employees can be proud of.
In conclusion, under the visionary leadership of the CEO, Krungthai Bank has successfully navigated the transition into a digital-savvy institution. By strategically harnessing technology, the bank has positioned itself as a leader in Thailand’s digital banking sector, serving as a shining example of innovation and adaptability in the face of digital disruption and the pandemic.
Article received by mail from Krungthai Bank
