Bank Negara Malaysia (BNM) Governor Abdul Rasheed Ghaffour highlighted the financial sector’s role in ASEAN’s economic integration and sustainable growth at the 2025 ASEAN Banking and Finance Summit.
He pointed to significant funding gaps, particularly in infrastructure and SME financing, stressing the need for blended finance to mobilise private capital.
ASEAN requires at least US$2.8 trillion in infrastructure investment by 2030, while MSMEs face an annual financing gap of over US$300 billion.
Abdul Rasheed noted progress in regional financial integration, including capital flows, payment connectivity, and banking system integration under ABIF, but said intra-ASEAN investments remain untapped and regulatory coherence needs improvement.
He highlighted the growing role of digital financial services in financial inclusion but cautioned that rapid technological advances require balanced regulation.
He cited Malaysia’s regulatory sandbox and licensing frameworks for digital banks and insurers as efforts to support financial innovation while maintaining stability.
Islamic finance was also identified as a complement to traditional banking through risk-sharing and social finance instruments.
Malaysia’s iTEKAD initiative was cited as a blended finance model supporting microentrepreneurs, while US$56 billion in sukuk issued in 2023 primarily funded renewable energy and green real estate projects.
Abdul Rasheed emphasised talent development, pointing to Malaysia’s Financial Sector Future Skills Framework and FSTEP program as efforts to upskill professionals and prepare graduates for finance careers.
He called for greater regional collaboration on talent mobility, including mutual recognition of qualifications.
As Malaysia prepares for the ASEAN Chairmanship in 2025, BNM will host an investor roundtable and pitching sessions on green and transition project financing during the ASEAN Finance Ministers and Governors Meeting in April.
Abdul Rasheed reiterated the financial sector’s role in AEC 2045, emphasising that funding, technology, and talent will drive ASEAN’s long-term resilience.
Featured image credit: Edited from Freepik
