Chatchaval Chearavanont, the grandson of Thanin Chearavanont, the wealthiest billionaire in Thailand and also the owner of Charoen Pokphand Group (CP), is heading towards a completely different business direction from previous generations by stepping into digital finance.
Considering that there are over 21 million migrants throughout Southeast Asia, in which more than 5 million people are in Thailand, these foreign workers need a convenient way to conduct financial transactions with the lowest fees possible. Therefore, “Velo” was launched as a blockchain-based international money transfer service provider in Thailand. This is a challenging endeavour due to the large amounts of international transfers in Asia, which are worth over 65 billion dollars a year.
According to the World Bank, current service fees for cross-country transfers from Thailand is 15%, which is higher than the average fee across other Southeast Asian countries at 9%. Moreover, these transfers in Thailand takes Velo plans to charge a transactional fee only 1% with real-time transactions.
However, Velo is not the only blockchain company in Southeast Asia developing a project to ease the process of cross-border payments and transfers. Ripple has partnered with SCB and MoneyGram and other companies to also drive more efficient cross-country transfers in Asia.
Alibaba has just launched blockchain payments in Hong Kong. There are over 300,000 foreign workers. Similarly, Facebook also has a strong user base in Asia with over 577 million people and it plans to launch Calibra to provide financial services as well.
Tridbodi Arunanondchai, vice president of Velo, said that Velo is not directly competing with Western Union and Ripple. Velo is focusing on the business-to-business model with a digital structure similar to JP Morgan or Citibank’s. Both banks act as credit insurance for customers globally.
Velo has released a digital asset called “Velo Tokens” for various organizations to achieve the “Know Your Customer” process by checking and evaluating the credibility of each transaction. The certified organization will receive a stable coin cryptocurrency.
Currently, Velo has raised $50 million dollars in funding. Interestingly, Velo is partnering with CP Group, the largest privately held company in Thailand with over 200 subsidiaries worldwide and $54 billion dollars a year in revenue.
Selected 7-Eleven retail stores in Thailand have also received a license from CP Group to provide deposit and withdrawal services in stores.