Amid a post-pandemic slowdown in tourism, Thailand has launched an 18-month program aimed at evaluating if cryptocurrency payments can boost international visitor numbers.
A Decline in Visitor Numbers
Before the arrival of COVID-19, Thailand attracted approximately 39.9 million foreign tourists annually, contributing around $58.86 billion to its economy. Despite this, the country has struggled to attract travelers post-COVID, leading its state-planning agency to lower its 2025 forecast for foreign visitors by 10%, to an expected 33 million.
The Introduction of TouristDigiPay
In response, Thailand is implementing the TouristDigiPay” program. This initiative allows foreign tourists to convert cryptocurrencies into Thai baht when making purchases within the country.
A Joint Effort
Backed by collaboration between the Finance Ministry, Anti-Money Laundering Office (AMLO), and Securities and Exchange Commission (SEC), this project builds on a recent study about financial innovation and digital assets. The goal is to foster both economic growth and tourism.
Regulatory Requirements
To use TouristDigiPay, travelers must open accounts with a crypto firm and an e-money provider regulated by the appropriate agencies. These firms must adhere to Know Your Customer (KYC) checks as required by AMLO. The program operates in a sandbox environment with spending limits to prevent direct digital asset payments for goods or services. Merchants will receive payments in Thai baht.
Restrictions on Usage
The service is only available to tourists staying temporarily in Thailand. Once approved, users can exchange their crypto assets for baht and make electronic payments, including those using QR codes.
Addressing Travel Stressors
Providing a secure way to pay locally is crucial for travelers abroad. China’s Alipay observed a tenfold increase in foreign tourists after integrating with other regional wallets. Digital assets, due to their decentralized and secure nature, are considered potential solutions for improving cross-border payments despite the volatility of crypto markets. Programs like TouristDigiPay aim to mitigate these risks by converting crypto to local currency immediately.