Malaysian digital banking trend - 2016
The push for online banking, thanks in no small way to Bank Negara Malaysia (Central bank of Malaysia), has had a significant impact on the way the Malaysian public carry out their banking transactions. There has been an increase in the volume of online payments from 49 per capita to 82 per capita over a 5 period and a reduction in the use of physical cheques from 206 million in 2011 to 148 million in 2015.(Tables 1 and Chart 1). Although the statistics show that there has been an increase in the use of digital channels, mobile banking still has a low uptake as compared to internet banking (Chart 2). This is probably due to the limited features on current mobile apps and mobile phone services. It is noteworthy that it costs RM3 to process a cheque compared with 20 to 50 cents via an interbank transfer. Malaysian banks have saved approximately RM231 million in cheques-processing costs between 2013 and 2015, while the saving by the consumers approximated RM611 million. According to Datuk Muhammad Ibrahim, Governor of Bank Negara Malaysia, adaptation of e-payment methods would increase banks’ competitiveness and allow innovation of new products and services that add value as well as reduce cost in the long run. Indeed, as the central bank is working towards doing away with the use of cheques, it is also steering us towards a cashless society.
Table 1
Chart 1
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