THE adoption of cashless transactions is becoming more prevalent in Malaysia as advancement of technology and digital world help to drive the evolution of money, and the emergence of Covid-19 further drives the growth. 

According to Ipsos Malaysia public affairs assoc director Lars Erik, over half of the Malaysian population is now using cash-less payments on daily basis and the continued growth in usage is driven by easing of Covid- 19 restriction in recent months which enable Malaysians to be out and about again. 

“Even though the usage of the cashless transaction is more common among the urban segment, the lower income group has also started to adopt the payment method and become familiar with it as well. 

“As such, more than half of Malaysians now have an average of two cashless payment channels at their disposal and they are largely using it at food and beverage outlets, and retail stores,” Erik said recently. 

Having said that, e-wallets and digital payments aren’t something new as the concept has been around for more than two decades. 

World’s 1st Digital Payment

The Coca-Cola Co was credited with launching the world’s first digital payment system back in 1997 with several vending machines in Helsinki. The soft drink giant created a digital payment processing system where customers could pay for their soft drink via a text message on their cell phones. 

Although the payment system is said to be the origin of the e-wallet, it is slightly different from the modern-day e-wallet transaction that we are seeing now. 

This is because the modern-day e-wallet allows consumers and businesses to process payments and invoices online or at the point-of-sale. 

Additionally, e-wallet also uses encrypted technology which means they are much safer and more secure than carrying around a traditional wallet, debit or credit card. 

Malaysia’s e-wallet Landscape

According to a report by Fintech News Malaysia, there are currently a total of 53 e-wallets in the country, with the industry occupying 19% of the countr y’s fintech space, and according to a study conducted by Ipsos, Touch ‘n Go eWallet remains the preferred e-wallet in Malaysia. 

Developed through a joint venture between Touch ‘n Go and Ant Financial in November 2017, the eWallet offers a more sizeable e-wallet than other e-wallets in the country as it allows users to send RM5,000 per month to peers and over 150,000 merchants nationwide. 

From there, the eWallet achieved several milestones such as being the first eWallet to convert one of the city’s famous Ramadhan bazaars into a venue that can accept cashless payment with the implementation of QR codes. 

The Touch ‘n Go eWallet was also one of the three e-wallet services in Malaysia that was eligible for its users to receive an RM30 stimulus plan as part of the E-Tunai Rakyat programme under the Budget 2020 plan, which encourages the adoption of cashless and mobile payment in Malaysia. 

Currently, the eWallet has more than 11,000 reload points nationwide that enable consumer to reload money into the digital wallet. 

Exiting The Landscape 

Just like the saying of “when the competition gets tough and more players entering the fray, there will be one or two that is unable to take the heat and throw in their towel”, and the e-wallet landscape is no different. 

Vcash, among the first e-wallets in Malaysia, exited the e-wallet landscape barely two years after it was introduced by Digi.Com Bhd. 

According to soyacincau. com, the digital wallet ended its service on Nov 30, 2019. At that time, Vcash’s interface is much more user-friendly compared to others in the market as it allows the user to log in instantly using their face or fingerprint, and they can make payment by just scanning a QR code instead of requiring the merchant to scan the code. 

Additionally, the digital wallet also allows the user to make withdrawal by transferring to a Maybank account or receive it as cash at a Digi store with a minimum fee. 

Integrating NFC with E-Wallet

With time, we are witnessing new technologies being used to make the payment experience better than ever and one of these technologies is near-field communications (NFC). 

And earlier this year, Touch ‘n Go Group integrated the NFC technology into their Touch ‘n Go card and introduced an enhanced version of the card. 

According to the company, the enhanced card enables its user to conduct any reload via their Touch ‘n Go eWallet without any surcharge, a feature that the previous generation of Touch ‘n Go cards does not have. 

The enhancement simply makes it much easier and more convenient for card users to facilitate reloading.