“Malaysia is at a pivotal time in its history - both politically and technologically - and is uniquely positioned in Southeast Asia to cement its position as the region’s fastest growing FinTech hub.”
Compared to their Western counterparts, banks in Asia have been slow to adapt to the digitisation of the financial space, leading to an increase in demand for similar services that cater to digital-savvy markets. Among banking executives in Malaysia, a whopping 82% believe that their industry is at risk of losing out to emerging fintech companies, compared to 73% in Singapore, and 67% globally.
However, the fintech scene in Malaysia has undoubtedly made huge strides over the past two years, with the ecosystem rapidly expanding in that time. With a healthy number of fintech companies operating in this space (mostly in payments), the recent regulatory certainty established by the P2P lending industry has also led to more international companies setting up shop on these shores. Such regulations help to set up clear lines in which fintech firms can operate, also leading to more diversification in terms of verticals serviced.
“Our inaugural annual Malaysia FinTech report marks the start of a massive collaborative effort that will grow to include many more viewpoints, voices, and verdicts on the local ecosystem over the coming years," said Johnny Mayo, general manager of fintech accelerator SuperCharger.
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“The contributions in this report reflect the thoughts of multiple key stakeholders in an industry going through a transitional period of sustained modernisation, but ultimately deliver the same core message - and that is if you’re a FinTech founder looking to expand into Asia, then Malaysia is a pretty good place to be.”
Malaysia is already considered a global market leader in Islamic Finance, but is now also emerging as a growing fintech hub. Boasting an internationally competitive economy, its geographical relevance to ASEAN places it strategically at the heart of a region that is home to 630 million people, with a GDP of US$2.5 trillion. Carefully observing international best practices, the last mover advantage has allowed banks and policy makers to modify and fine tune these before implementing them locally.
“While we facilitate the entry of new digital businesses into our ecosystem, the SC is also focused on driving the digitisation of our traditional capital market. This initiative is crucial to unlock greater operational efficiencies within our market, and also enhance the experience for our investors and issuers. We are working collaboratively with the industry and different stakeholders to identify areas ripe for digitisation, and to implement pragmatic solutions which would benefit the industry as a whole.” - Securities Commission Malaysia
With dedicated fintech accelerators such as SuperCharger spearheading efforts to advance the industry in Malaysia, it’s safe to say that the future is bright. The next edition of the 2018 SuperCharger programme launches on Tuesday, Sep 18, putting an eclectic cohort, made up of 10 local and international fintech scale-ups, through their paces in a bid to secure contracts and deals from some of Malaysia’s top financial institutions. Such efforts will further help to diversify the fintech space in the country, with the effects likely to be felt further down the road.
The Malaysian Fintech Ecosystem Overview 1.0 was featured on the Fintech News Malaysia article “13 Industry Leaders’ Predictions About Where Malaysian Fintech is Headed”.