Joint venture deal marks Korean banking’s return to Thailand after 25 years
Kakao Bank is moving deeper into Southeast Asia through a joint venture with Thailand’s fintech group SCBX to launch a digital bank.
The Korean lender said Thursday that CEO Yun Ho-young and SCBX CEO Arthid Nanthawithaya held a signing ceremony in Bangkok on Wednesday to formalize the deal. Under the agreement, Kakao Bank will initially take a 10 percent stake in the new entity and plans to gradually increase its holding to 24.5 percent, becoming the second-largest shareholder.
The partnership follows Thai regulators’ approval in June of the country’s first virtual banking licenses, with the Kakao Bank-SCBX consortium securing one of three permits. SCBX will lead the project, with Kakao Bank and China’s WeBank joining as partners.
The consortium aims to begin operations as early as the second half of this year. Bank of Thailand rules require licensed operators to launch within 12 months of approval, although timelines may be adjusted through coordination with regulators.
AI-native bet on Thai banking
Kakao Bank, the nation’s largest internet-only bank, made its initial push into Thailand in June 2023 by signing a partnership agreement with SCBX, the holding company of Thailand’s third-largest commercial lender, Siam Commercial Bank.
Kakao Bank pointed to Thailand’s low level of financial inclusion despite high digital penetration, noting that smartphone adoption exceeds 90 percent, while nearly half of the country’s 70 million people remain unbanked or underbanked.
Thai virtual banks are expected to operate under a framework similar to Korea’s internet-only lenders, focusing on broader access to financial services for underserved retail and corporate customers, while keeping physical branch networks limited and costs low through technology.
“This collaboration reflects our belief that the future of banking must be more inclusive, accessible and driven by technology of purposes,” SCBX CEO Nanthawithaya said in a separate statement Thursday, adding that the upcoming virtual bank will target financial access gaps, improve customer experience and support sustainable growth of the local financial ecosystem.
SCBX said the fundamental principle lies in building an AI-native platform, integrating artificial intelligence into core processes, product development and customer interactions to deliver personalized services and improve operational efficiency.
Kakao Bank will oversee the front-end development, including product innovation and user experience design, drawing on its domestic operating track record, while WeBank Technology Services, the technology arm of China’s WeBank, will support the project with scalable infrastructure and AI capabilities.
Bridging gaps, global push
The Thai venture also carries symbolic weight, marking the return of a Korean bank to the market nearly three decades after lenders exited during the Asian Financial Crisis. Aside from the Korea Development Bank’s non-operational office, it will be the first resumption of banking services by a Korean lender in Thailand since 1998.
Kakao Bank is currently the only Korean internet-only lender operating banking services overseas. Its first foreign venture was in Indonesia with Grab to launch SuperBank, taking a 10 percent stake in the digital bank. SuperBank turned profitable within nine months and successfully listed on the Indonesian stock market in December.
“The Thailand entry is a symbolic milestone, marking the return of a Korean bank to the Thai market for the first time in 25 years since the Asian Financial Crisis,” Yun said Thursday. “Building on Korea’s digital finance strengths, we will establish a successful virtual bank model and use it as a springboard for global expansion.”
By Choi Ji-won (jwc@heraldcorp.com)
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