According to the International Monetary Fund (IMF), the penetration rate for internet banking in Malaysia has quadrupled in the past ten years, reaching over 107% in 2020, while the country ranks first among developing and emerging Asia in the World Economic Forum’s Network Readiness Index. This conducive environment has resulted in the emergence of a dynamic fintech industry in Malaysia, whose growth has been accelerated by the Covid-19 pandemic. According to global professional accounting organisation CPA Australia, the pandemic led over three-quarters of Malaysian businesses to utilise at least one fintech service. During this period, mobile banking grew by 130%, and the country registered a 260% increase in active e-wallet users, the latter representing the highest growth among the countries in the region.
A key strength of the local industry is Malaysia’s highly developed market for Islamic banking, which has facilitated the growth of a thriving Islamic fintech segment, too. According to the 2021 Global Islamic FinTech Report, Malaysia ranks first out of 64 key Islamic fintech markets worldwide, with the most robust ecosystem supporting the industry.
Today the Malaysian fintech industry boasts a developed ecosystem of private and public sector investors, and counts 233 fintech companies, the third-highest number in South East Asia. Importantly, Malaysia has a diverse scene, with players having developed expertise in a wide range of areas.
