The digital platform economy presents Thailand with a critical duality: it is both a powerful engine for sorely needed economic growth and an area that necessitates careful regulatory oversight.
As the global economy continues to slow and Thailand’s overall economic growth stagnates, the digital sector has never been more vital.
The Ministry of Digital Economy and Society projects that Thailand’s broad digital GDP this year will reach 4.69 trillion baht, a robust 6.2% growth rate that is more than three times the overall GDP projection. This underscores the sector’s crucial role in national development, with the digital services sector alone expanding by 5.7%.
The e-Conomy SEA 2024 report by Google, Temasek and Bain and Company estimated Thailand’s digital economy measured by gross merchandise value was worth $46 billion (1.5 trillion baht). This immense digital ecosystem — driven by e-commerce, transport, online food delivery, online travel and media platforms — represents a high-stakes foundation for the nation’s economic future.
The report identifies the components of the digital economy based on four platform business types:
E-commerce: valued at $26 billion, up 19% year-on-year;
Transport and online food delivery: worth $4 billion, up 6%;
Online travel: valued at $10 billion, up 32%, the fastest growth rate in Southeast Asia;
Online media such as video-on-demand, music-on-demand and games: worth $6 billion, up 7%.
Essential Intermediaries
Digital platforms function as essential intermediaries, connecting users in a manner that aligns with the definition of a market — for instance, linking buyers with sellers, riders with passengers, or consumers with restaurants and delivery services.
However, platforms distinguish themselves from traditional markets through two key qualities: close-to-unlimited scale and multi-faceted transactions. In essence, platforms are more advanced markets that drive efficiency as the volume of buyers and sellers grows.
Buyers benefit from greater product and service variety, lower prices and better promotions. Sellers gain access to vast consumer bases across the country 24/7. Platforms also lower the entry barriers for entrepreneurs, allowing small businesses to set up online stores instantly without heavy investment.
For consumers, platforms offer greater product variety, competitive pricing and attractive promotions. For entrepreneurs, especially smaller SMEs — a particularly vulnerable group in the current economy — platforms are transformative.
Critically, platforms offer a significant cost advantage over traditional retail, where combined gross profit and administrative charges can consume 40% to 50% of gross sales. This ability to lower costs and reach vast consumer bases is a primary driver of the entire digital economy’s sustained expansion.
Credibility and Protection
The rapid concentration of market power that accompanies this growth, however, has led to understandable concerns over potential market monopolies and non-transparent practices. Recognising the increasing importance of online platforms to the economy and society, and the imperative to ensure financial security, credibility and reliability, the Electronic Transactions Development Agency (ETDA) introduced the Royal Decree on the Operation of Digital Platform Service Businesses that are Subject to Prior Notification BE 2565 (2022).
The core rationale of this digital platform services (DPS) law is fourfold:
Enhance credibility and transparency: to build trust in the burgeoning digital transaction ecosystem;
Consumer and user protection: to prevent possible damage to the public and provide protection for platform users;
Ensuring financial security and reliability: requiring a system to maintain security, credibility and reliability in online transactions;
Information collection for effective governance: mandating prior notification of business details to the ETDA and annual updates for larger platforms, to provide the necessary data to monitor the market and formulate effective future policies.
All platforms meeting certain thresholds — such as annual revenue exceeding 1.8 million baht for individuals or 50 million baht for legal entities, or more than 5,000 monthly users — must notify the ETDA of their operations.
Specific obligations, such as verifying merchant identities and displaying necessary regulatory marks, have also been placed on large online marketplaces, along with enhanced regulatory duties, like verifying riders and passengers on ride-sharing platforms. This demonstrates a clear move toward tailored and risk-based governance.
Balancing Act
While the industry recognises and welcomes the government’s need to ensure a fair and safe digital environment, the central challenge remains the delicate balancing act of how to regulate without killing innovation.
The risk of over-regulation, especially a system that relies on outdated, conventional trading paradigms such as burdensome, costly and time-consuming licensing or approval regimes, must be carefully managed. For many SMEs, excessively high compliance costs — even minor ones — could significantly hamper their ability to survive or scale.
The moment regulations cease to offer a marginal consumer protection benefit but instead impose a heavy burden, they transition from being a guardrail for growth to an obstacle against it.
Digital platforms are not opposed to regulation; in fact, they desire predictable, clear and context-aware regulations that minimise compliance friction while achieving the public policy objectives of fairness and safety.
The goal must be to design regulations that are intrinsically digital: light-touch for smaller players and proportionate to a platform’s risk and size.
Foreign Platforms
Government oversight of digital platforms must be comprehensive and equitable. It should not be confined solely to platforms legally registered in Thailand. Instead, state agencies must urgently expand their regulatory reach to cover international platforms operating but not registered within the country.
This action is critical to mitigate risks faced by Thai consumers and entrepreneurs arising from non-standardised operations. Furthermore, it is essential to prevent the nation from losing valuable tax collection opportunities.
Collaborative Governance
Given the critical juncture for Thailand’s economy, and a target to raise the digital economy’s contribution to 30% of GDP by 2027, from about 27% now, a cautious, consultative approach is not just advisable — it is vital.
Authorities must ensure that regulations do not inadvertently become barriers that restrict new investment or impede the continuous product and service development that modern consumers demand.
This requires meaningful consultation between the government, the private sector and civil society to rigorously assess the impact of all regulatory measures, especially those with significant compliance costs.
A collaborative approach will allow all parties to set a direction that creates the maximum benefit for all stakeholders across the entire ecosystem.
By prioritising smart, flexible and forward-looking governance, Thailand can successfully mitigate the risks of the platform economy while maximising its opportunities, ensuring that the digital sector remains a strong and sustainable foundation for long-term economic development.