In a statement released on April 29, Bank Negara Malaysia said that Malaysia has issued digital banking licenses to five of the 29 companies that applied for digital banking licenses. Three traditional financial licenses were granted to a consortium of RHB Bank and Boost Holdings, an Axiata Group fintech subsidiary; a consortium led by e-commerce firm Grab and Singtel’s digital banking joint venture GXS Bank and Malaysian conglomerate Kuok Group; And a consortium led by Singapore-based e-commerce and gaming company Sea and YTL Digital Capital, the fintech subsidiary of Malaysian infrastructure group YTL…
Malaysia has issued digital banking licenses to five of the 29 companies that applied for digital banking licenses, the country’s central bank said in a statement released on April 29.
The grant of three conventional financial licenses to a consortium of RHB Bank and Axiata Group’s fintech subsidiary Boost Holdings; a consortium led by e-commerce firm Grab and Singtel’s digital banking joint venture GXS Bank and Malaysian conglomerate Kuok Group; and a consortium led by A consortium led by Singapore-based e-commerce and gaming company Sea and YTL Digital Capital, the fintech subsidiary of Malaysian infrastructure group YTL Corporation.
Two Islamic digital banking licenses were awarded to a joint venture between Japan’s Aeon Financial Services, Malaysia’s Aeon Credit Services, and Malaysia-established US financial app MoneyLion; and a consortium led by Kuala Lumpur-based KAF Investment Bank.
Pilot period of up to two years
Licensees must now go through an “operational readiness period” where they will be audited before starting operations – a process expected to take 12 to 24 months, the central bank said.
“Digital banking can help individuals and businesses better access more personalised solutions powered by data analytics,” central bank governor Nor Shamsiah said in a statement.
“Digital banking also provides a safer and more convenient way to transact as businesses migrate online,” she added.
Detailed assessment “in the best interests of Malaysia”
Licensee selection is based on an assessment of the soundness of its underlying technology, the soundness and viability of its business plan, its ability to provide financial services to underserved and unserved target groups, and its contribution to the stability of the financial system” In the best interest of Malaysia,” the governor added.
Digital banking is expected to reduce the number of underbanked and unbanked in Malaysia, where almost all adults of the country’s 32 million population are smartphone users, but so far not all have access to financial services or even a bank account.
