Although fintech companies have not substantially grabbed market share from securities companies, traditional brokers need to adapt to the new regulatory environment and digital era to maximise operational efficiency, says the Association of Securities Companies (Asco).
Thai securities companies will need to keep adjusting to prepare for new competition as the amended Securities and Exchange Act of 2019 supports greater competition by allowing new players to enter the country's capital market industry, said Asco chairwoman Pattera Dilokrungthirapop, who is chief executive of DBS Vickers Securities Thailand.
"It is possible to have a new exchange operated on the digital platform with a lower cost of operations," said Mrs Pattera.
There will not be many exchanges because Thailand's capital market is not large enough to absorb them, she said. A new bourse platform is not expected in the short run because of the constantly shifting nature of technology, said Mrs Pattera.
With securities digitisation, investors and fundraisers will have new ways to raise funds in the future, she said.
"The partnership between Seamico Securities and a financial group focused on securities digitisation is an example of the transformation and migration of securities companies in the new era. I think there will be more of this in the future," said Mrs Pattera.
Thailand's capital market saw the rise of fintech in 2015 following startups using the internet and technological innovations to conduct financial businesses.
At that time, traditional market participants were concerned whether they would be disrupted because many mobile applications helped retail investors to analyse investment choices and set their own investment criteria.
"Fintech companies have operated in Thailand for more than two years, but this has not reduced securities brokers' transaction volume," she said.
"Both fintech companies and brokers have been doing the same thing [expanding the market's size], and new investors who begin to enter the capital market via mutual funds will step up to invest in stocks via securities companies."
