How Malaysia’s Largest E-Wallet is Leading the Charge in Financial Inclusion

Financial inclusion in Malaysia has been given a boost in recent years and part of this is largely due to the development of the fintech sector which has managed to penetrate underserved markets using digital technologies.

Recent data from the Global Financial Inclusion Index ranks Malaysia among the top 20 markets for financial inclusion out of 41 global markets.

Bank Negara defines financial inclusion as the provision of suitable, affordable and quality financial services to all segments of society. Indeed, the role that fintechs play in this, is many-fold.

If before they could not, via fintechs, underserved markets can now gain access to microloans and other banking products like savings accounts and other digital financial services.

This in turn allows the overall economy to experience more growth and development. The World Economic Forum notes that telcos and technology companies are in a unique position to accelerate financial inclusion and create a more equitable financial system.

In Malaysia, one company is also well positioned to do this. TNG Digital, the operator of TNG eWallet, has long had financial inclusion at the core of its business strategy.

In 2017, the company, which started out as a strategic partnership between Touch ‘n Go and Ant Financial, launched TNG eWallet, a move that changed the dynamics of the digital payments and financial services space across Malaysia.

TNG eWallet’s User-Centric Design and Low-Entry Barriers Drive Widespread Adoption

In an interview with Fintech News Malaysia, Alan Ni, CEO, TNG Digital said that they prioritise financial accessibility and empowerment through its products and services, focusing on a user-friendly interface and extremely low product entry barriers.

“With nearly 22 million verified users and millions of micro-SME merchants, we enable seamless digital payments through a simple QR solution, paired with extremely low or even zero transaction fees.

“Our offerings are not only user-friendly and convenient but also highly accessible, with entry barriers as low as RM10,”

he said.

For instance, its GO+ has become the largest money market fund in Malaysia, with over 3 million active users.

“We are the first e-wallet that allows you to open an ASNB account and invest. You can also buy digital gold with e-Mas, and invest in various funds managed by Principal and all of this can be done effortlessly at your fingertips in just minutes, starting with as little as RM10.”

In line with one of its main objectives of championing financial inclusion for millions of foreigners in Malaysia, TNG Digital has received approval from the Department of Labour Peninsular Malaysia (JTKSM) to facilitate digital wage payments for unbanked migrant workers.

It has also partnered with the United Nations High Commissioner for Refugees to extend financial services to marginalised communities, ensuring they have access to secure and convenient digital financial tools through TNG eWallet.

Overcoming Perception Challenges

That said, the company does acknowledge that there are still many challenges to contend with when it comes to advocating financial inclusion.

One of the main issues TNG Digital faces is having to manage a “few misconceptions regarding non-bank fintech companies” like itself.

“First of all, many people are hesitant to put significant amounts of money into e-wallets because they believe these funds are not protected by PIDM.

“However, e- wallets are subject to a robust regulatory framework by Bank Negara that offers a comparable level of protection,” Alan said.

He further explains that under the central bank’s regulations, the funds one transfers into e-wallets must be placed into separate trustee accounts.

E-wallet operators cannot access these funds except for specific purposes, such as settling payments one makes to merchants.

“This means that even if an e-wallet provider goes out of business, your money remains safe in the trustee account,” he explains.

He also said some people might perceive that the TNG eWallet is less secure than traditional banks.

In reality, the company said it was the first financial institution to implement Bank Negara’s new anti-fraud measures in early 2023.

TNG is a member of the National Scam Response Center and the only e-wallet that is a founding member of the National Fraud Portal, an initiative led by Bank Negara and PayNet.

“Fintech companies like ours offer some of the most financially and digitally inclusive solutions available, yet misconceptions can hinder people’s adoption of these services. That’s why it’s crucial to dispel these misunderstandings.”

He said TNG Digital is dedicated to “democratising” financial access and enhancing financial awareness and literacy across Malaysia.

“Our mission is to make essential financial and lifestyle services affordable and accessible to everyone, especially those with limited financial resources or capabilities.”

TNG Digital’s Partnership with MDEC: A Catalyst for Financial Inclusion

A key supporting factor of this is TNG Digital’s close collaboration with the Malaysia Digital Economy Corporation (MDEC) which has helped it drive financial inclusion in Malaysia, and play a significant role in the country’s digital transformation.

Awarded the Malaysia Digital (MD) status by MDEC earlier this year & part of the MD Founders Center of Excellence (MD FOX) programme, TNG Digital has gained access to government support, policy influence, and business infrastructure, which are crucial in advancing our financial inclusion initiatives, the company said. It added that its partnership with MDEC also emphasises increasing digital literacy among Malaysians.

Via various educational campaigns and initiatives, it has been able to help users better understand and effectively use digital financial tools, and this has been particularly impactful in encouraging older generations and those unfamiliar with digital services to embrace cashless payment systems.

Future Initiatives: TNG Digital’s Expanding Role in Malaysia’s Digital Economy

Moving forward, TNG Digital will continue to expand its financial services and products within the TNG eWallet, further diversifying and making financial tools accessible for all.

This is exemplified in its recent partnership with Affin Hwang Investment Bank Berhad and Bursa Malaysia to provide an “equity trading platform” to its users.

“As we connect nearly 22 million verified users with our 2 million merchants, we recognise our responsibility to provide financial access, empowering merchants in the digital economy.”

To this end, the company will continue to enhance this commitment by introducing more comprehensive support initiatives, building on its existing initiatives.

MDEC offers various programmes for Malaysia Digital status companies. Apply for Malaysia Digital status here.