by DASHVEENJIT KAUR/ pic by BERNAMA

MALAYSIA Digital Economy Corp (MDEC), the agency under the Ministry of Communications and Multimedia, signed a memorandum of understanding (MoU) with Mastercard to advance the digitalisation of the economy and support the short-term National Economic Recovery Plan’s (Penjana) digital initiatives.

The collaboration will focus on enabling e-commerce for micro, small and medium enterprises (MSMEs), fostering financial inclusion for unbanked and underbanked populations in rural communities and driving the adoption of digital disbursement solutions.

“It is the ministry’s and MDEC’s aspiration to firmly establish Malaysia as the heart of digital Asean and reinforce its regional digital powerhouse role that engages global champions, such as Mastercard, by ensuring the digital economy will drive shared prosperity for all Malaysians as well as the region,” said Deputy Communications and Multimedia Minister Datuk Zahidi Zainul Abidin.

According to Zahidi, the cash usage in Malaysia has declined by 64% amid the Covid-19 pandemic and there has been a 40% increase in usage of mobile or digital wallets.

The growth has made the government to focus on supporting and assisting the recovery of SMEs.

The deputy minister said the partnership will look at rolling out digital payment technologies nationwide for SMEs to sustain their businesses.

“Going digital for businesses means they can drive their revenues, as they can do financial transactions with customers and suppliers in a faster, secured and cost-effective manner, as well as access new marketplaces.

“The government is also looking at creating security firewalls to prevent financial hackers and data theft,” Zahidi said.

Zahidi added that MDEC is also working on reaching out to rural communities through financial digital literacy programmes.

He also said they will focus on businesses that sell halal goods or other Muslim products, as they make up a large portion of the SMEs, which are the “backbone of the economy”.

Meanwhile, Mastercard country manager Perry Ong said going cashless could improve Malaysia’s GDP and enable the economy to recover faster.

He believes Mastercard would help the ministry and MDEC beyond the MoU to fast-track the capabilities of SMEs to survive on a long-term basis.

“If the government announces that there will be a Penjana 2.0, we will be happy to work with it to see how we can facilitate the cash to reach the SMEs through possibly a Mastercard instrument,” he said, adding that they will receive their money in digital form.

Under the collaboration, Mastercard will work together with MDEC to support industry partners to facilitate the rollout of Mastercard payments and business technologies.

Both partners will also leverage each other’s programmes such as Mastercard’s global mentorship programmes and signature Girls4Tech STEM curriculum to promote digital and financial literacy for vulnerable groups, such as underprivileged women and girls, and women-led enterprises.

MDEC CEO Surina Shukri said while there had been an increasing migration to e-commerce prior to the pandemic, 25% of businesses still lacked the necessary infrastructure to take advantage of the growth in online shopping.

“By working with Mastercard and drawing on their expertise in developing vast electronic payment infrastructure, we look forward to tackling a range of pressing economic and social issues through technologies that better connect individuals, communities, and businesses to become digitally skilled Malaysians and digitally powered businesses of all sizes across the country,” she said.