The fintech landscape in Malaysia saw remarkable growth in 2024, driven by the launch of the country’s first digital banks, a surge in digital payment adoption, and pivotal regulatory advancements. This year’s progress is captured in our latest Malaysia Fintech Report 2024, offering an in-depth look at the key milestones and emerging trends shaping the industry.
Produced in collaboration with Merchantrade and supported by industry leaders, regulators and fintech innovators, the 2024 Malaysia Fintech Report provides a comprehensive overview of the year’s fintech progress, focusing on emerging trends across digital banking, payments and wealthtech.
Malaysia’s first digital banks begin operations
2024 was a milestone year for Malaysia’s banking sector with the launch of the country’s first digital banks.
Grab’s GXBank became the first digital bank licensed by Bank Negara Malaysia (BNM) to launch to the Malaysian public in November 2023.
The digital bank, which has remarkably amassed nearly one million Malaysians, provides fully digital personal banking through products like the GX Account, GX FlexiCredit with instant approval, and the GX Card, offering instant cashback. For businesses, GX Biz Banking offers a seamless digital onboarding experience, daily interest payouts, and access to GX Biz FlexiLoan.
AEON Bank followed GX Bank as Malaysia’s first Islamic digital bank, commencing operations in May 2024. Owned by Japanese conglomerate AEON Group, AEON Bank offers savings accounts, payment cards, budgeting tools and a range of digital payment solutions.
Finally, Boost Bank was the third to launch in 2024. Owned by Axiata Group and RHB Banking Group, Boost Bank began operations in June, enabling seamless account opening via its e-wallet. Boost Bank’s current offering includes a savings account, the Savings Jar and a debit card.
Two digital banks are still pending launch, namely the YTL-Sea consortium and the KAF consortium.
QR Payments grow sixfold in Malaysia
Besides the launch of Malaysia’s first digital banks, 2024 also saw the domestic e-payment sector achieve significant growth.
E-payment transactions per capita increased 20% year-on-year (YoY), rising from 285 in 2022 to 343 in 2023. Across key e-payment methods, cards recorded the strongest growth at 26%, followed by e-money and credit transfers, which rose by 26% and 20%, respectively.
Adoption of digital payments in Malaysia has increased significantly over the past years, driven by several modernization initiatives by the government such as MyDebit, the national debit card scheme; the Real-time Retail Payments Platform (RPP); and DuitNow QR, the country’s QR code standard for mobile payments.
Launched in 2019 as an extension of the DuitNow instant payment service, DuitNow QR allows users to make payments across different banks and e-wallets by scanning a single QR code. This unifies and simplifies QR payments in the country, eliminating the need for multiple QR codes from various providers.
Within just four years, DuitNow QR reached mainstream adoption, recording 2 million registrations in 2023. This represents a 6.3-fold increase since its inception and reflects a greater penetration compared to point-of-sale (POS) terminals in Malaysia, which total less than 876,000.
Given these encouraging data, BNM believes that Malaysia will achieve its target of increasing e-payment per capital at a compound annual growth rate (CAGR) of more than 15% by 2026, as laid out in the Financial Sector Blueprint.
Robo-advisors crosses one million accounts
Another fintech vertical outlined in the report is digital wealth management. The sector saw significant growth in 2024, surpassing the one million account mark and reached total assets under management (AUM) of RM 1.6 billion.
The vertical currently comprises nine players, with StashAway leading the sector.
StashAway, which launched in Malaysia in 2018, is a digital wealth manager that offers investment portfolios and wealth management solutions for retail and accredited investors. In addition to its home country of Singapore and Malaysia, the company also operates in the United Arab Emirates (UAE), Hong Kong and Thailand.
StashAway claims more than 50,000 clients in Malaysia, and over RM 1 billion in AUM in 2023.
Key fintech regulatory developments in Malaysia
In 2024, regulatory developments kept pace with industry changes. Notably, the Securities Commission Malaysia partnered with Khazanah Nasional to explore tokenized bonds, aiming to enhance efficiency and transparency in bond issuance and operations.
The year also saw the establishment of the National Fraud Portal and the implementation of malware shielding in banking apps, demonstrating a proactive approach to the growing challenges of fraud and the evolving crime landscape.
Finally, the introduction of the Digital Insurance and Takaful Operators (DITO) framework by BNM in July marked a pivotal step towards greater inclusion, competition and efficiency in the insurance industry.
Malaysia Fintech Map 2024
In 2024, more than 280 fintech companies were active in the Malaysian fintech landscape. Payments was the largest vertical with a 22% share, followed by lending (12.5%), e-wallet (11.9%), blockchain (7.6%) and cross-border payments (7.6%).
| Download the full Malaysia Fintech Report 2024 |
Featured image credit: edited from freepik
