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June 13, 2024

Thailand Accepting Applications for Programmable Payment Regulatory Sandbox

The Bank of Thailand (BOT) has announced its new Enhanced Regulatory Sandbox, which provides an opportunity to experiment with currently restricted financial innovations under a controlled environment. The BOT is employing a thematic approach to determine the scope of technology or innovations that may participate in the Enhanced Regulatory Sandbox and will only accept applications in each theme for a limited period.

The first announced theme is “programmable payments,” which refers to payment and payment-related transactions with automatic execution upon the fulfillment of a predefined condition utilizing distributed ledger technology (DLT) and a smart contract or comparable technology in which electronic data units are issued on an electronic system or network. The application period for programmable payment testing in the Enhanced Regulatory Sandbox runs from June 13 to September 13, 2024.

A summary of the programmable payment testing framework under the Enhanced Regulatory Sandbox is provided below.


The Enhanced Regulatory Sandbox accepts applications for the following programmable payment activities:

  • Automated payment and settlement upon fulfillment of predefined conditions.
  • Escrow services with predefined delivery or transactional conditions.
  • Asset tokenization through issuance of digital tokens representing rights in an asset, with payment for tokens or payment of benefits or returns to holders of digital tokens occurring automatically when conditions are met.
  • Other testing related to the items mentioned above.

Requirements and Conditions

Programmable payment testing activities in the Enhanced Regulatory Sandbox must comply with the following requirements and conditions:

  • Electronic data units issued for programmable payment testing must be pegged to the Thai baht (THB) on a one-for-one basis (i.e., 1 unit = THB 1), with the float account storing THB equal to the value of the electronic data units issued.
  • Participants must define the redemption rights of the unitholders and proceed with the THB redemption according to the participants’ service level agreements.
  • Participants must have risk management, IT support, business continuity, and IT disaster recovery plans.
  • Participants must comply with know your customer (KYC), know your merchant (KYM), and customer due diligence (CDD) standards under the relevant laws and regulations of Thailand’s Anti-Money Laundering Office.
  • Participants must have a client suitability assessment process to prevent vulnerable customers from using services under the testing.
  • Participants must have measures to prevent the utilization of electronic data units for purposes outside the scope of testing (e.g., using the units as means of payment outside the scope of the test, listing the units on digital asset platforms, or using the units for investment or speculation purposes).

For more information on the BOT’s regulatory sandbox program, regulations on programmable payments, or any other aspect of fintech in Thailand, please contact Athistha (Nop) Chitranukroh at [email protected], Pornpan Wichawut at [email protected], or Rujaporn Paritsantik at [email protected].

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