Siam Commercial Bank launches stablecoin remittance services

Siam Commercial Bank (SCB), Thailand's oldest commercial bank, has announced it will begin offering stablecoin-based cross-border remittance services. 

Partnering with fintech firm Lightnet, the bank aims to provide clients with the ability to send and receive payments 24/7, while also reducing transaction costs. 

The addition of stablecoin services is expected to enhance financial inclusion by offering lower transaction fees, making it particularly beneficial for those receiving remittances from higher-value currencies. 

Lightnet CEO Tridbodi Arunanondchai emphasised the advantages, stating, "This project promotes financial inclusion with lower capital requirements per transaction. It also offers unique value propositions to retail, corporate, and institutional clients." 

SCB's new service was successfully tested through the Bank of Thailand's regulatory sandbox, which allows financial institutions to experiment with digital assets under more flexible rules without regulatory concerns. 

The increased use of stablecoins, particularly those denominated in U.S. dollars, has been observed across developing nations as they serve as a store of value against depreciating local currencies. 

A recent Chainalysis report showed that stablecoins account for about 43% of all crypto transaction volume in Sub-Saharan Africa. 

The report's findings suggest a correlation between currency devaluation and stablecoin adoption, reflecting similar trends in regions such as Latin America. 

For instance, in Venezuela, where currency devaluation has been severe, stablecoins made up more than half of the digital assets sent as remittances in 2023. 

The trend is also evident in other Latin American countries, including Argentina, Brazil, Colombia, and Mexico. 

Mastercard’s report from March 2024 further highlighted this shift, noting that remittances to South America were increasing at a faster rate than in any other region. 

The company predicted that blockchain assets like stablecoins would continue to grow in market share, driving the move towards a more digital economy.