More Malaysians are ditching cash for digital wallets to make purchases,but they are mostly urban residents.
In the past year,the number of transaction through e-wallet has gone up by 130pc.Mobile banking has also seen a surge by upto 125pc.This has pushed Kuala Lumpur’s position in the Global Fintech Rankings 2021 to 67th spot,up 11 rungs from the previous year.
As expected, the acceleration in the adoption of digital finance has been driven mostly by the Covid-19 pandemic,Vincent Fong,chief editor of Fintech News Malaysia,told TheSun.According to the publication’s 2021 report,there were 233 financial technology firms in Malaysia last year,up from 193 the year before.However,the uptake in digital financing has not been evenly spread across the concentrated in the Klang Valley.The overall uptake of digital finance here has been slower than in many other contries.Among countries polled,Malaysia drops 10 rungs to settle at 46th spot.
The ranking,powered by cloud banking platform Mambu,examined the fintech ecosystem of more than 264 cities across 83 countries.It stated that the sector has expanded globally,building upon a surge in demand for technology that increases access to digital finance.Apart from e-wallet transactions and mobile banking,crypto exchanges also saw a surge.There were eight times more new accounts last year compared with the year before and funding has also increased with rising interest in Malaysia’s fintech start-ups shown by investors.
Fong believes the trend is here to stay as consumers get comfortable with the digital channels out of necessity and eventually getting used to the convenience it brings.”However there is still room for improvement.Industry players should ramp up efforts to educate users given that along with the increase in usage,there has also beep more scams and frauds,”he said – Sources from The Sun.