Malaysians swiping more often: E-payments jump 20 per cent in 2023 - BNM

KUALA LUMPUR - Electronic payment (e-payment) adoption among Malaysians continued to increase in 2023 to 11.5 billion transactions compared to 9.5 billion in the previous year, according to Bank Negara Malaysia (BNM)

In its Annual Report 2023 released today, the central bank said it is on track to achieve the Financial Sector Blueprint target of more than 15 per cent compounded annual growth of e-payment transactions per capita between 2022 and 2026.

This is on the back of the 20 per cent growth to 343 transactions per capita in 2023 compared to 285 transactions per capita in the previous year.

"E-payment growth was supported by consumption activity as the total value of selected retail e-payment transactions grew by 17 per cent to reach RM592 billion, complemented by collective public and private sector efforts to increase e-payment adoption,” it said.

BNM highlighted that credit transfer services formed the largest share of e-payment transactions with a 43 per cent share.

Among the many credit transfer services, DuitNow Transfer continued to be the preferred option, sustaining a high annual growth rate of 32 per cent (2022: 26 per cent) and a 39 per cent market share of credit transfer services, according to the report.

The central bank said that the acceptance of e-payment transactions among businesses, especially among small-sized enterprises, continued to gain traction.

"In particular, DuitNow QR transactions have seen significant take-up since its introduction, driven by greater familiarity with the DuitNow QR service, popularity with customers due to its convenience and its lower cost for merchants relative to other e-payment alternatives,” it added.

Meanwhile, BNM continued to explore the potential of the Central Bank Digital Currency (CBDC), especially to improve cross-border payments, while exploratory work on domestic wholesale CBDC is ongoing and is expected to further intensify in 2024.

"As digital assets gain traction, we are also committed to ensuring that the involvement of the Malaysian financial sector in digital asset activities is managed responsibly, with a clear understanding of how such activities can reduce or increase operational and financial risks.

"Although financial institutions have indicated openness to explore the potential of digital asset-related activities and distributed ledger technology (DLT), their current focus remains limited to providing traditional services to digital asset players such as payments, deposit and trust accounts,” it said.

Moving forward, the central bank noted that it will continue to work to ensure that Malaysia’s payment systems and the money services business (MSB) industry remain safe, efficient and reliable in support of the needs of the economy.

"To this end, we continue to proactively identify and address emerging risks, as well as to support greater use of e-payments, as well as work closely with stakeholders from the public and private sectors to safeguard public confidence and promote responsible innovation.

"BNM also remains dedicated to future-proofing the domestic payment infrastructures in line with aspirations in our blueprint, including intensifying exploratory work on CBDC and asset tokenisation as well as adopting emerging technologies such as DLT in the financial system,” according to the report. - BERNAMA