Only 5% total daily payments are cashless to date, says MoF

To increase cashless payment adoption, e-payment facilities must be widely available with hassle-free systems, says minister


ONLY 5% of total daily payments are made cashless in the country so far, according to Finance Ministry (MoF), as cash transaction is still a preferred payment method by Malaysians for purchases like groceries, parking, magazines and newspapers.

Thus, to increase cashless payment adoption in Malaysia, Finance Minister Lim Guan Eng said e-payment facilities must be widely available with hassle-free systems for users.

“First, e-payment facilities must be widely available, safe and simple to use. It must be as convenient as cash, and this is where having central payments infrastructure providers such as PayNet will address the enablement aspect to increase adoption,” he said at the launch of Cashless Ecosystem for Cyberjaya yesterday.

Lim added that making inclusive infrastructures that address services from banks and financial technology such as the retail payment platform would contribute positively to the goal.

“The other important aspect is in changing behaviour and habits where an important lever is to elevate financial literacy, which is where the public sector will primarily need to step up,” he said.

Lim added that in regard to the nation’s financial literacy, the government launched the National Financial Literacy Strategy 2019 to 2023 July last year, which is a comprehensive five-year plan that aims to improve the local financial security.

“According to Bank Negara Malaysia (BNM), one in three Malaysians consider themselves as having low financial knowledge, particularly among low-income households.

“Literacy in e-payments is an important component to this strategy, given its obvious benefits in financial management,” he said.

He said 20% of Cyberjaya population are early technology adopters.

“So, that and the city’s Smart City and Living Lab propositions driven by Cyberview Sdn Bhd are key factors in making the community here perfect for this initiative.

“Looking ahead, the government intends to forge ahead with its going cashless policy,” he said.

The plan for Cyberjaya to go cashless started in 2018, which began with the goal to secure over 80% of merchants to accept at least one e-payment mode.

Its farmers market and pasar malam sellers are also targeted to be digitally enabled to accept e-payments.

Meanwhile, the ecosystem launch was a collaboration between MoF Inc’s Cyberview and BNM’s affiliate, Payments Network Malaysia Sdn Bhd (PayNet).

The ecosystem initiative will be facilitated by Malaysia’s national quick response (QR) code standard, DuitNow QR.

Cyberview MD Mohd Najib Ibrahim said via the initiative, Cyberjaya will be the first city in Malaysia to adopt a national QR code under BNM’s Interoperable Credit Transfer Framework (ICTF).

“Cyberview will spearhead this with our partner, PayNet, to encourage more businesses to adopt cashless solutions and further ease payment transactions for communities in Cyberjaya,” he said.

PayNet group CEO Peter Schiesser also presented on the proliferation of QR codes and eWallets to clarify further questions and confusions.

“The DuitNow national QR standard established under BNM’s ICTF enables a merchant to sign up with one acquirer which will then eventually enable 22 million bank customers and millions of eWallet customers to make payments,” he said.

Currently, nine banks are offering DuitNow QR in their mobile banking apps, with 23 banks and four major eWallets expected to implement DuitNow QR over the next six months.

The national QR code standard will foster an efficient payment landscape, whereby merchants only need to display one QR code to accept payments.

In the race to increase cashless payment adoption, the government has also launched the e-Tunai programme, which offers RM30 to every consumer who is over 18 years old and is earning less than RM100,000 annually.