Deutsche Bank has announced the launch of PromptPay instant payments in Thailand. As part of the phase one roll-out, the bank will be offering its clients instant collections throughout Thailand. Later in the year, phase two will enable instant payments to be made throughout the country.
PromptPay collections for corporates are fast and secure and use either an account number or a proxy-id (corporate tax ID number) to receive incoming payments nationwide, as well as corporate income tax refunds from the Revenue Department without any additional charges.
The PromptPay innovation is part of a government-led payments modernisation programme aimed at supporting financial inclusion and the roll-out of electronic payments. The system is operated by National ITMX, a national payments service provider in Thailand.
Deutsche Bank says it offers instant payments as a service allowing beneficiaries to receive funds within seconds, thereby minimising the risks of outstanding payments and maximising working capital. In addition, by combining instant payments with application processing interface (API) technology, the bank is able to offer new interactive opportunities to its clients to seamlessly integrate payments into their business and treasury processes. Currently, the bank supports instant payments in nine locations around the world.
“Efficiency, accuracy and speed of payments are increasingly critical for corporates, so we are very proud to make instant payments available to our clients,” said Pimolpa Suntichok, chief country officer - Thailand at Deutsche Bank.
“PromptPay is the third instant payment platform we are rolling out in ASEAN after FAST in Singapore and DuitNow in Malaysia, and we expect to further expand our instant payment capabilities in ASEAN with the Philippines and Vietnam in the next 24 months,” added Burkhard Ziegenhorn, head of ASEAN for the Corporate Bank at Deutsche Bank. “These platforms help our corporate clients to replace traditional modes of payments such as cheques, a trend we are seeing sharply accelerating in the current pandemic environment.”
Instant payments bring real-time treasury into view
Last year, Deutsche Bank published a white paper on instant payments in which it explored the benefits they can offer to both corporates and consumers. The paper describes how instant payments ends the cash flow latency of what is often two or more working days until a payment process is closed. When combined with the support of application programming interface (API) technology, the result is a transformative proposition for corporates which can embed deep in their processes and play an integral part in the customer experience.
For many modern business relationships and business models, lengthy payment execution times are no longer acceptable - particularly in an e-commerce or on-demand environment. The seller needs certainty that the buyer has paid the requested amount before the goods are sent or the service provided. To eliminate or minimise waiting periods for the client, typically payment methods are used with a guarantee for the seller that they will receive the payment. Giving such a guarantee is not free of charge; somebody needs to be compensated in return for undertaking the risk. The use of instant payments sets out to alleviate the costs associated with a transaction, for both corporates and consumers.
The Deutsche Bank white paper notes that the benefits for corporates do not stop with that example. Making a payment in real time can be seen as simply the first step on the journey to a real-time treasury. Looking ahead, instant payments mean that liquidity buffers become obsolete, with surplus cash invested elsewhere. Real-time cash-flow forecasts will pinpoint the exact time and amount of borrowings that may be required.
The white paper does acknowledge that instant payments are relatively new on the market, with the infrastructure and product features still being developed. However, with the direction of travel clear, corporates can think about how to prepare for both the future of payments and a real-time treasury.
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