Interview: Smart Axiata CEO Talks About SmartPay and SmartLuy

Smart Axiata, the leading 4G LTE provider in Cambodia, is a mobile telecommunications company in Cambodia. As part of the Axiata Group Berhad, one of the largest telecommunications group in Asia, Smart Axiata serves over eight million customers.

Here at Geeks in Cambodia we are always interested in learning about new technologies. We were familiar with Smart Axiata’s SmartLuy, a service that gives customers the opportunity to make fast and secure cashless payments. With the advent of digital payment solutions, Smart Axiata’s recently launched SmartPay intrigued us. SmartPay is a service that allows customers to have a virtual credit card without the need of an actual credit card.

We sit with the CEO of Smart Axiata, Thomas Hundt, to find out more about SmartLuy’s services and the launch of SmartPay.

This interview has been edited for length, clarity and flow.


Could you tell us more about SmartPay?

SmartPay is a solution that allows any Smart customer to pay by a virtual credit card which is attached to the phone number and the main balance of your SIM card, literally. The functionality behind this is called direct operator billing, so it means it is charged directly from your prepaid credit you have on your phone. It means there’s no need for anyone to walk into a bank to obtain their credit card to link it to their bank account. We know that in Cambodia credit cards and bank account penetration are still fairly low, with credit cards much lower than bank accounts. So for our eight million Smart customers, anyone can now have a virtual credit card for purchases at the Apple App Store and iTunes. This opens doors for all Cambodians to buy apps, do in-app purchases, buy songs, to literally take an Apple music subscription, you name it – whatever you can buy on Apple. We’re planning to launch SmartPay on Google Play soon as well so all Android users can buy their apps and their content from Google Play.

It enables the people to participate in the app world as full fledged as anyone else with a credit card. In return, it also enables finally the app developer community to monetize their work by charging consumers for the app or for certain in-app purchases such as feature upgrades, if it is an online game it can be credits for tokens etcetera.

How does SmartPay work?

How does it work it’s pretty simple, you send REG by SMS to *999 and you are getting in return your Mastercard number and the validity and the security code that allows you immediately to transact. Certainly you need to have credits on your mobile phone for an account. To use it you access iTunes, and in your user registration you just key in your credit card number and that’s it, and you can immediately buy your apps or you content.

SmartPay allows any of Smart’s customers to have a virtual credit card

What is the origin of the project?

SmartPay was developed together with a couple of partners, one partner is certainly Apple, and the second partner is Canadia bank, which is sponsoring the credit card numbers. Mastercard is part of it as well so you’re getting a Mastercard number attached to your mobile phone number.

SmartPay is not designed for paying hotels or airlines it’s made for micropayment, which typically apps and contents are. Most of the apps are 99 cents or 1.99, or 2.99. SmartPay is available for all except postpaid customers. In April there is no subscription fee, but for May onwards we are charging a small subscription fee of 10 cents a month as a credit card fee and since it is direct operator billing, there is a small charge on top of the transaction amount. If you pay 1.99 for the app, Smart is charging 50 cents extra because we have to cover local taxation in Cambodia and that amount is being paid from the transaction fee. During the months of April and May, transaction fee is only half, which is 25 cents per transaction.

What drove your company to develop this kind of service?

On one hand we want to enable our consumers to be part of a full-fledged digital ecosystem, SmartLuy is one other direction we have entered, but SmartPay focuses on allowing consumers to buy apps and content digitally. Our overall Smart strategy is data leadership, we are investing massively into the data networks and most of your readers, most of your developers, most of the internet users in Cambodia they use Smart as their access to the internet. In addition, it certainly enables the ecosystem and not only is it very important for us as a mobile Internet provider in this case, but also for flourishing the digital economy in Cambodia. That is the main reason at the end of the day why we do it, we want to build a digital ecosystem, and we want to bridge the digital divide which we still have in Cambodia.

What are the added values of SmartLuy as compared to other money transfer services already existing in Cambodia?

SmartLuy is a next generation mobile money service and in this particular manner I am saying mobile money and not mobile transfer or money transfer service. While money transfer is one feature of SmartLuy, our main focus is payments. However, having said that, the function of money transfer we know in Cambodia is the most popular service and here our competition has developed a model that has become relatively popular in Cambodia, which are agent-based transactions. This kind of service opens doors for tax evasion and money laundering big time, that’s why we focus SmartLuy on wallet-based transactions, which is a form of user-generated transaction. We have a SmartLuy app, we have a USSD menu, so it allows any customer with a smartphone or a feature phone to transact.

We also have an agent network, we have to have it, as people need the possibility to top up their wallet, and agents are largely designed to take the money which you put in cash to put in your wallet. So in contrary to agents based money transfers and any other mobile service here in Cambodia, where you have to pay a fee for money transfers, you can now transfer your money from A to Z as often as you like, free of charge. Our focus ultimately are payments, so internet payments, payment of schools, payment of subscription services, payment of EDC bills, you pay your microfinance loans or your insurances via SmartLuy, you don’t need to go to a bank to make your payments.

Internet Payment Gateway is open for any ecommerce website, shopping, bus booking service, cinema, ticket reservation, whatever you like. There’s no monthly fee for developers to subscribe. The fees per transaction are far less than if you pay by credit card, you’re talking about 0.25% roughly as a fee, which website owners can decide if he is charging the consumer or if he is covering the cost. But if you consider it in a way where credit card payments cost you three point something percent, it’s far more reasonable and attractive for website owners and ecommerce owners than credit card payments.

One of the major hurdles of any ecommerce or mobile commerce breakthrough in any country is at the end of the day payment facilitation. SmartLuy, as any other mobile service, to a certain extent, would allow you to get cashless transactions, and that is the main advantage at the end of the day for the community of developers and digital entrepreneurs.

What are some of the main challenges and the achievements of SmartLuy so far?

User adaptation is a challenge to a certain extent no doubt. You need to create the wallets, you need to download the app if you want to use it most conveniently, but that is a hurdle which literally each and every digital service have, but we have done our homework. We are building an ecosystem, we are signing up the payment partners, the Internet Payment Gateway partners, corporate partners, payroll partners etcetera to seek a good traction of user adaptation and getting transactions flowing. At the end of the day we are very much on track and in terms of achievements the number of parties signed up is quite impressive already. It means users have plenty of opportunities to make payment, such as EDC. For example, schools, Internet Gateway Payments etcetera are all live and everyday it is increasing.

SmartLuy allows customers to make cashless and convenient payments

What is the positive impact SmartLuy has on Cambodia?

The positive impact, as I mentioned, pure agent based money transfers without identification of sender and receiver, are opening the doors for money laundering, tax evasion etcetera. You cannot prevent this from happening entirely, neither can SmartLuy, but ultimately we believe the informal economy in Cambodia is moving towards a formal economy step by step. The government is pretty much behind it, tax authorities are behind it and it has to be like this because if Cambodia wants to become a better country, have better infrastructure, then tax payments also have to be common practice and not an unwanted obligation. So from that perspective, building a system such as SmartLuy which then also will be used by a few government authorities to collect payments such as for company registration, potentially for your driver’s license or alike, is driving informal economy towards formal economy.

What is the positive impact SmartPay has on Cambodia?

The positive impact of SmartPay, a prominent impact certainly, is that users can buy apps which they couldn’t so far, and the app community, the app developer community can finally monetize their work and get some money for the intellectual properties they are developing, which is an equally important if you want to develop a digital ecosystem. We need more local content and at the end of the day everybody has to make up its living, even the app developers cannot survive just by the number of downloads, they need to find a way to also fund their development. Even if its micropayments, at the end of the day the quantity is making up to some, enabling micropayments is another route for developers to make up their living.

What are the upcoming developments and achievements Smart hopes to achieve for SmartLuy and SmartPay?

We have a plan certainly for the next few years how to evolve both SmartLuy and SmartPay, SmartPay is now available for Apple, we are coming out with Android soon, then literally for SmartPay the ecosystem is set. For SmartLuy, it is an ongoing development, there are new ecommerce parties coming to the market, new online shops, new cinemas, new bus services, new microfinance institutions. We want to establish SmartLuy as the number one alternative to cash and bank transactions, so consumers will have the possibility to pay via SmartLuy for whatever they can do online and in digital, so really establishing it as an alternative to bank, cash and ultimately credit card payments. It’s already more easy to use than credit cards, and more affordable, cheaper, but bank transactions and cash is what we want to offer a real alternative to.


We would like to thank Mr Thomas Hundt and the Smart Axiata team for their time and the insights they provided. With Cambodia’s emerging digital scene, we look forward to seeing more innovative digital services in the Kingdom!

If you would like to find out more about SmartPay, be sure to catch the video down below.